Imagine you saved an extra few hundred dollars every paycheck, what would you do with that extra money? Even more specifically, imagine you saved an extra $500 a month! That money would go a long way at the end of the year. To put things in perspective for you and to encourage you to save, here’s a few things you could do with extra money.
Travelling is a great way to spend your extra money. If you saved an extra $500 a month, or $250 per paycheck, you would have $6000 in 12 months. $6000 can get you a vacation in several European countries, depending on your accommodations and spending habits. Or, $6000 can even get you to visit a few of the Pacific islands for a couple weeks.
Maybe you’re newly graduated or you have a lot of expenses; either way, a brand new car is out of the question. However, being a car owner is still feasible. If you start saving an extra $300 a paycheck, in 12 months you could have over $7000. Not only would you be able to buy a used car in good condition but you would now have the saving habits to pay for car insurance, gas and any necessary repairs.
Maybe travelling the world is your dream but you have to put your dream on the back burner because you want to take your entire family on a vacation. Using the same scenario from point 1, if you saved $250 per paycheck you would have $6000 in 12 months. That $6000 would get a family of four a week’s vacation in a nearby country. It’s a nice gesture – especially if your family doesn’t get many opportunities to travel.
Moving out of mom and dad’s house is a huge expense. Ideally, you should have a full time job with guaranteed 40 hours a week and decent pay, but even with all that you need to save your money for quite some time. Since you’ll be living on your own soon you might as well start the good saving habits now, which means minimal spending and maximum saving. Make it a goal to save at least $500/paycheck – in 12 months you’ll have enough money to rent your own place, buy furniture and have a reasonable emergency fund. Furthermore, in some cities $12,000 can even get you a small mortgage.
Saving only $100 a month will give you enough money to invest in the stock market or bonds a year from now. Investing, although risky, can reap great rewards. However, do research and get advice from a professional financial advisor before investing in anything.
Saving $500 a month will cover small renovations or upgrades in your home. In a year, if you are able to save $6000, you’ll be able to upgrade your kitchen appliances, build a reasonable home entertainment system or renovate the bathroom or basement.
Many people aren’t very enthusiastic about putting money in their retirement savings. They would rather spend the money now. However, not only is putting money in your retirement savings a financially sound decision, but it can also get you a generous tax write off at the end of the year!
Saving money is a difficult process but the outcome is always worth it! Stretch your dollar, use coupons or buy used, but just do whatever it takes to save an extra dollar. At the end of the year you’ll find you have more money to play with. What are other things someone could do with a little extra cash?