Savings. What’s that? For so many people, the concept of savings seems like a fairy tale. Living month to month or paycheque to paycheque is a challenge in itself. So many times it seems like there is more month than money. It is not unusual to start off with the best intentions to save some money but for whatever reason the savings plan collapses.
Ideally, it is recommended that you have at least two months of living expenses saved so that you are able to deal with some of the unexpected things that life can throw at you such as car repairs, emergency travel, or an unexpected tax bill. The challenge lies in how to get that amount built up. If building up some savings is a goal of yours then spring is an excellent time to put that into action. Here are a few ideas to help you on your journey.
1. Set a modest goal that is doable. That might mean saving a very small amount in month one. The important part about savings is not the amount saved but rather time because time can transform that small amount into a much larger amount. Even saving something as small as a toonie this month is starting some positive momentum. Start small but start now!
2. File your personal income taxes and use part of the refund to start up your savings. That is why spring is a good time to start up your savings plan because Canada Revenue Agency will be sending out refunds to a lot of people. That tax refund can “prime the pump” and get your savings off to a good start.
3. Track your monthly expenses for a month or two and review where you could adjust your spending. If you don’t know what your monthly expenses are it is very difficult to make an informed decision and progress towards savings. A good analogy is that you are trying to find something in the dark or heavy fog. In contrast, once you are certain what your expenses are, it becomes more like a clear day.
4. If you often use your debit card ask your financial institution if they have any savings plan available that would create a savings deposit with each debit card transaction. This might take the shape of 50 cents per transaction or rounding the purchase to the next dollar. Either way that creates a trickle of savings for each debit card transaction.
5. Spring and summer are prime time to pick up a little extra cash. For example, people often need some help with yard work or painting. Part time seasonal jobs also become available to help take care of the tourists that come to see our beautiful part of the world.
6. Having a garage sale is a time tested way to generate a few extra dollars and declutter your house. You might have more than you think!
7. If you are more of a cash person and pay for things in cash, try saving every loonie or toonie that comes back to you in the form of change. This can be a powerful way to build some savings.
These are just a few ideas to help you on your way to building some savings. However, if you are carrying debt, you may need to take some other action. The best intentions for savings can evaporate in the face of high interest credit card debt. If your debt is not going down, or if you are experiencing collection pressure, we would encourage you to take advantage of a free initial consultation with a Licensed Insolvency Trustee. At our office, we will meet with you face to face and discuss your financial situation. There are a variety of options that can help change the financial momentum in your life such that the negative momentum of debt disappears and is replaced by the positive momentum of savings. Please contact us at one of our convenient locations to learn more. You will be glad you did!