4 Creative Tips for Saving Money

4 Creative Tips for Saving Money

By: Jacqui Kearns

With the COVID-19 crisis ongoing, economic uncertainty looming, many people are worried about their budgets and inability to save money. Times are undoubtedly difficult but thinking creatively can help you cut spending in areas that you never considered before. Here are four tips for saving money – not just during the COVID-19 pandemic but always.

dollar on table

1. Do an official “Subscription Audit”: It’s become so easy to download apps and subscriptions digitally that we often forget we’re paying for them, especially if we don’t make a habit of looking at our credit card bills. But if you scrutinize your statement, you very well may find that you have a subscription to a streaming service or news source that you no longer use – and that you’ve been unknowingly paying for months or years. In an age of digital overload, this is often a source of unexpected cost savings. Beyond subscriptions that you didn’t know about, you should also take the time to look at those you do know about. Think about whether you really enjoy watching that streaming service or reading that newspaper as much as you used to, or whether you really want to maintain your gym membership when you haven’t done so much as lift a dumbbell in three years.

2. Save – or invest – the equivalent of what you spend: An effective and creative way to reduce spending is to match every dollar that you spend by saving or investing another dollar. This serves two purposes. On one hand, it ensures that the spending you do now is balanced out by saving or investing for the future. On the other hand, it serves as a check on your current day-to-day spending, since matching dollars spent with dollars saved or invested means you’ll have less room for non-essential purchases. You can do this yourself through careful budgeting, depositing money into your savings account equivalent to each purchase, or else you can download an investment app that automatically invests when you buy stuff (you can read more about such apps here1). If you opt to put this money into a savings account, you should make sure you have one that maximizes the money you can make off interest, such as Affinity’s new SmartStart account that allows you to earn a 2.00% APY on balances below $2,500.

3. Do more shopping online – especially for groceries: Online shopping is often seen as a reason for getting thrown off your budget, not sticking to it. But as online purchases increase due to social distancing rules and guidelines, there might actually be a financial benefit in addition to the obvious health benefits. A recent article2 in Tech Crunch noted not only a spike in online shopping but that it was driven by grocery shopping, something that most people still do primarily at brick-and-mortar stores. While we often don’t think of a trip to the grocery store as an opportunity to “splurge,” we’re just as tempted by impulse purchases there as well. We go to pick up bread and cereal but end up being tempted by the cakes on display at the end of the aisle or the magazines by the checkout. Doing grocery shopping online allows you to choose what you need and log off before you fall victim to psychological-driven food and product displays, thus potentially saving you money.

4. Find a credit card with high rewards and low interest rates:  Generally, overuse of credit cards is a bad idea when trying to save money, as they often have the effect of breaking the psychological link between buying stuff and losing money since you’re not handing over cash, and it’s easier to lose track of your spending when you’re just swiping a card (or charging purchases to an online account). But in these difficult times, the reality is that many people are seeing their cash flow dry up and are having to rely on credit to get by. If you do have to rely on a credit card, be sure to use the one that offers the lowest possible interest rates and gives you cash back rewards for purchases (these are more important now that you may have to charge larger purchases than normal). If you don’t think your current cards offer these advantages, be sure to shop around for better options. Affinity’s various options are a good place to start. And if you want to transfer balances from a current card from a different institution to a new or existing Affinity card, we aren’t charging any balance transfer fees from now through December 31, 2020!

Though many people may feel that their current financial situation is overwhelming, there are some ways that you can make things better. Now more than ever is a time to think outside the box and make financial changes whose benefits could last well beyond the current crisis.

                                                   

For additional information and updates from Affinity about COVID-19, please visit https://www.affinityfcu.com/banking/we're-here-for-you.aspx

This information is for informational purposes only and is intended to provide general guidance and does not constitute legal, tax, or financial advice. Each person’s circumstances are different and may not apply to the specific information provided. You should seek the advice of a financial professional, tax consultant, and/or legal counsel to discuss your specific needs before making any financial or other commitments regarding the matters related to your condition are made.  

1 Retrieved from https://www.forbes.com/sites/jaimecatmull/2019/10/07/the-15-best-investment-apps-for-everyday-investors/#630c0786145b

2 Retrieved from https://techcrunch.com/2020/05/12/us-e-commerce-sales-jump-49-in-april-led-by-online-grocery/