The new year represents a fresh start to a life of financial freedom. While your 2017 might have been filled with recurring monthly bills, unexpected costs, and impulse purchases, 2018 can be the year you finally take control of your personal finances and start building the retirement nest that can sustain you and your family in your senior years. Here are 10 tips on how to make bank and start saving money this 2018:
2018 Budget Tips:
1. Break Free From Poor Spending Habits
Increasing your bank account size doesn’t necessarily mean you need to put more money into it; you just have to prevent money from leaking out. Poor spending habits can cause your bank account to shrink in size. Buying packs of cigarettes, expensive liquors, the latest smartphone, magazine subscriptions, movie tickets, and other unnecessary expenses are the culprits of why people can’t save money. Set a budget, make plans, and don’t give up! Make it your new year’s resolution to break free from these financially, and even physically, detrimental habits.
2. Start a Business
Your bank account will initially take a hit when starting a business. But once you break even from the equipment, website, business permits, and licenses, your bank account can grow exponentially in a short period of time. Starting a business entails finding an under-served niche and providing a valuable product or service. Common ideas when starting a business include bakery, reselling other people’s products online, accounting, tax filing, and so forth. A brilliant book on how to start a side business is The 4-Hour Work Week by Tim Ferriss. It has hundreds of valuable resources on how to start a side business and well worth reading.
3. Walk Dogs
A common side hustle that fits the schedule of college kids and stay-at-home parents is dog walking and pet sitting. Walk your neighbors’ dogs and get paid in cash. A one-hour walk can net you up to $40 per dog. If you have five dogs in a day, that’s $200 cash. And you don’t even need to walk them separately. You can walk two or three dogs at any given time, reducing the time you need to complete these walks. Dog walking isn’t just a good side hustle, it’s also a good way to exercise and meet people. One of the best companies out there to help you succeed is Rover where you can sign up to be a sitter, dog walker, etc. in your own city.
4. Look For Cheaper Alternatives
Take books as an example. If you buy brand new textbooks as a college student, that will amount to roughly $655 per year. You can find books in good condition in sites, like ThriftBooks, which slash prices by up to 80 percent. Sure, you’ll have to pay extra for delivery, but the long-term savings are relatively higher than when you try to buy books at full price. Another example is food. Name-brand foods cost only a few cents higher than generic ones, but offer the same amount and nutritional value. Swap these name brands for the same quality generic brands you’ll find on most supermarket stores.
5. Monetize Your Assets
This is the principle of renting out assets that are currently not in use. It advocates what economists and companies are referring to as “collaborative consumption”. For instance, if you have garage or closet space, you can rent it out to neighbors who currently don’t have a garage for their car or indoor space for their belongings. This has two major benefits – it earns you money and it helps offset the ongoing problem of overpopulation and lack of real estate or land space by making sure every inch of space available is being used. A lot of companies, such as Airbnb and Neighbor, are building this “sharing economy” concept and so should you.
6. Design Websites
Design and maintain websites for businesses, professionals, and hobbyists. People are looking for ways to either compete in the eCommerce space or advertise their personal brands to the world. If you have even a basic understanding of computer programming and software development, this can be a lucrative side hustle for you. College kids and stay-at-home parents are often hindered by their lack of flexibility and time to go out there and earn money. A web design business is a good solution that works around these barriers. You can work from home and work on projects at your own pace, of course as long as you stick to your deadline. If you plan to put all your side hustle money into savings then you’ll start to see a dramatic increase in your net worth and you will gain financial stability quickly.
7. Reconsider Your Transportation Costs
Traveling to and from work, school, or wherever you need to go by car can be costly. Sure it’s more comfortable than taking a crowded bus on a hot, steamy day, but the costs can eat up your bank account. Fuel, maintenance, parking fees, and monthly insurance can add up to a few thousand dollars per year, depending on your car’s make and model. If you live near work or school, consider trading in your vehicle for a bike or, better yet, walk. If you are riding public transportation, consider getting tickets that are good for a week or month. These are usually sold at a much cheaper rate than those per-ride tickets. If driving is your only option then consider using a service such as Uber or Lyft where you can turn your driving miles into money by taking others with you on your way to work.
8. Invest Your Savings
Keep in mind that investing is different from trading. The latter involves a lot of risk and can result in more financial losses. Investing for the long term is safer and can produce significant returns for your retirement. Start investing by first allocating a fixed amount of cash. Only risk saving money that you can afford to lose. This is overused advice, but it cannot be overemphasized. Invest your savings in growth stocks that you plan to hold for the long run. Avoid costly brokerage commission fees that range anywhere between $10 to $20 per roundtrip trade which will quickly cut into your profits. Robinhood, Acorns, Wealthfront, or Stash offer cheaper commissions, free trading, and even micro investing you have the option and freedom to invest whatever amount you are most comfortable investing.
9. Ask Family or Friends For Help
Not for money, but for their time and energy. For instance, if you have pets or children, you can save hundreds of dollars per week from babysitting. According to a recent survey from Care.com, the average hourly wage for babysitters is $14. Ask your family member or trusted friend to look after your pup or kid while you’re away at work or school. Whether it be getting a haircut, babysitting kids, or moving into a new home, service from family and friends can definitely help save money in the long run.
10. Sell Things You Don’t Need
Consignment stores, pawn shops, and Craigslist are your best friends when trying to fatten up your bank account. Those antique furniture pieces you have collecting dust in your basement or those power tools you only really needed once can have value to someone else. When you sell things you don’t need, it effectively frees up space and, on top of that, earns you some cash. Then, instead of spending that extra cash, start saving money!
Doubling your bank account this upcoming 2018 takes more than just planning and wishing. While making changes to your professional life and using more effective economic concepts like the “sharing economy” is one way to make more money and successfully double your savings in 2018, a more important step would be to change your mindset. Changing the way you think about your money and spending habits is the best way to escape a bad financial status.