Saving. It just isn’t as easy as it seams. How often have you woken up and decided that it’s finally time to get serious and start saving money? How often have you gone to bed thinking, tomorrow, tomorrow is the day I will begin to save more. And how often do you sit in the line of your favorite outlet store saying, eh, what saving? Don’t worry, you’re not alone. Over 75% of Americans think about that same thing every year. 64% of them want to save more. And 34% of them don’t have a single penny saved. Just a few years ago – I was one of those people that had no savings, a massive amount of debt, and no plan to change it. I inevitable was able to change that and now want to help all of you overcome those same grave challenges of freeing yourself from financial burden and taking control of your finances. It all starts with saving. Let’s review a few ways to make saving simpler and more effective for you.
52 Weeks Money Challenge
This app is a terrific idea and I would highly recommend it for anyone up to the challenge. Especially, for those of us who are still trying to conquer or resolution of saving more in 2016. The 52 Weeks Money Challenge is an app that you can download on your iPhone or Android phone for free and is designed to help keep you on track for saving $1 the first week, $2 the second week, $3 the third week, and you get the point. It is a relatively simple idea andean be done on a very small savings budget. And with that, guess how much you can save over just one year? $1,378! That’s right, that small amount of savings can build you over $1,300 in just one year. Not a bad deal at all! The app keeps you on track and tracks your progress as you save each week. Keep in mind, the app does not do any of the saving for you – it is only there as a reminder to help you track your progress. Make sure you are putting the money away and in a place where you will not be tempted to spend it and this app will help you get there. Where and how should you save it? I will cover this in another post.
Acorns is a downloadable app that helps you save your extra change without having to think or do much of anything other than set it up and start spending. Acorns also will invest this money into one of five ETF portfolios that they have depending on your long term goals. Some are more conservative and some more aggressive. You are able to link your debit card or credit card to the account and every time you spend money Acorns will automatically round up the purchase and invest the change for you. Pretty cool, right? In 2014, I gave this a shot thinking that it would be a good way to save some extra money. I used Acorns for 15 months and over that time I was able to stash over $1,000 without doing anything (other than spend money) after the initial setup. That sounds great, and it is, however, I also analyzed the fee that I was charged every month and the performance of the money I was “saving” over that same period. Over the 15 months of use I managed to lose $151, or 15.1% of my savings. Granted, my portfolio selection was the most “aggressive” option and Acorns is very clear about the risk in each selection. Having said that, I tracked my portfolio’s performance against the S&P 500 and over that same period the S&P was only down 2%. It would seem your money could be put to better use. If you are planning to use Acorns for the Round-Up feature I would caution that you are mindful of how much that fee is actually saving you. Having said that, I do think Acorns is a resourceful tool and can be useful for those of us that are looking to save without putting much effort at all. After all $1,000 saved for not doing much at all is still saving as long as you let your money continue to compound and don’t pull it out after any signs of trouble in the stock market – you will be just fine using this app. Just remember, charges to help save are only beneficial if they save you more than you could have otherwise. Be smart and do your research.
One of my favorite tricks is the old fashioned way of accomplishing tasks – keeping a hand written note book. I used to think this was a simplistic way of looking at a very complex problem. When I was relentlessly searching for how I was going to pull myself out of extreme debt the last thing I had thought of doing was going to a hand written log that kept track of every single penny I spent and saved (or didn’t save). It seems contrarian to my earlier points but this worked the best. It is hard work, tedious, and sometimes downright annoying to do it this way. But I challenge you to try this. If you are serious about taking your financial livelihood back and freeing yourself of the stress and gruesome burden of save more and get rid of your debt writing down your monthly budget, tracking your savings progress, and constantly being forced to view your spending habits I guarantee you will be able to save more.
What savings tools have you used to help change your life? And what savings tools will you now use to help take control of your future?