Increase Your Savings Fast – One Easy Trick to Do That.
Almost everybody has faced a time in their lives where they are not satisfied with their savings, forcing them to forfeit on investment opportunities or even a happy retirement. Having some savings set aside either for retirement or a rainy day are extremely important, I cannot stress this enough. New entrepreneurial ventures, perhaps the house of your dreams can come true with a powerful amount of cash set aside, so you need to increase your savings fast.
During the past years I’ve developed a mind skill that I have happily taught others to further their savings by substantial amounts. The trick is simple, start by setting some time aside to really trickle down your expenses and debts. Once you have figured out your total monthly spending record that quantity on your journal or computer software.
Next we need to focus on DEBT. Try to pay your short debts as quickly as possible, this can include your traffic tickets, retail store credit cards etc… Paying off your short debt will get rid of the monthly payments that accumulate at the end of the month shorting you on the ability to increase your monthly contributions to your savings.
The real mind trick starts here:
Let’s say you figured out your monthly spendings amounts to $1,000, simply leave $1,500 on your savings account and transfer the remaining amount to either your IRA or your savings account and try to forget about that money. From now on you only have $1,500 in your checking’s account, $1,000 for your monthly expenses and $500 for unexpected spending.
Feeling poor can be a good feeling.
Now that your benchmark is $1,500 that is going to equal $0 in other words $1,500 = $0. In your mind, you DON’T have any MONEY. The feeling of stress (good stress, the one that keep you hungry and motivated) will keep your mind active on finding new investments, new ways to make more money or even more focused at work, because remember you “need the money” you don’t have it.
Stick with your benchmark.
Now that you cut down on your excessive spendings such as buying unnecessary depreciable items because of your “shortage of money” more money is going to be sitting on your checking’s account. You may also find out you are getting a good tax refund or perhaps you may receive a bonus paycheck you were not expecting, you will soon find out that you surpassed the $1,500 benchmark. Remember unexpected income in any source was not projected on your initial budget, meaning that you can live without it. Let me ask you, do you consider your tax refund or an unexpected bonus paycheck as part of your total income at the end of the year? Of course not, you may pay taxes on it, but it is never certain you will make the same amount next year meaning you can live without it.
What to do with the extra? Simply grab any excess of money from your $1500 benchmark and transfer it to your IRA, mutual fund or savings account forcing you to stay hungry for more time, the more you contribute the better. I am not talking about literary cutting your nights out or the things you enjoy in life, but keep them reasonable and within your budget.
The Bottom Line
If you continue to perform this easy mind trick, your mind will force a habit out of it, making it feel natural to live beneath your means. You will find it easier to tell apart what portion of your paycheck is the “excess amount” and how much is going to be transferred to your preferred savings account. Wait some time and see your savings grow like you’ve never seen them before, the power of compound interest is one of the greatest forces on earth.
It is hard at the beginning, but you need to keep focused on the long tem and eventually reap the benefits of your saved money working for you now, and not vice versa in the future.
Also make sure that your savings money is being invested that way your money can grow even faster than you think.
Pictures by: MaxHierro and stacheLhaut
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