Yahoo Finance Grow Your Wealth: 9 Savings Rules You’ve Never Heard Of
You’re probably well aware of the most common savings rules out there: keep a rainy day fund, cut out all the overpriced lattes, eat more at home, etc. You’ve likely even tried many of these without seeing much improvement in your account.
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But there are some lesser-known tips that could boost your savings in a big way. Below are some of the top, expert-backed savings rules you’ve probably never heard of.
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Open Multiple Savings Accounts
Carter Seuthe, the CEO of Credit Summit, personally loves and recommends contributing to multiple savings accounts as a strategy.
“I think lots of people end up just making a lump sum contribution to a single savings account monthly,” Seuthe explained.
While he says this can be a fine strategy for general savings, when you start looking toward establishing an emergency fund or saving toward specific goals like a home, it tends to be easier to distinguish these different savings goals when you have them in different accounts.
Seuthe added, “It also prevents you from having your savings total constantly fluctuating, which can make it difficult to keep track of your progress.”
Mikayla Reynolds, owner of Cash Offers, agrees with Seuthe.
“Ever feel the temptation to dip into your savings for something spontaneous?” asked Reynolds.
Her solution? Create separate savings accounts for specific goals, like an emergency fund or that dream vacation.
“It’s like putting your money on a leash, making it harder to spend on a whim.”
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The 72-Hour Rule
Before splurging on anything non-essential, Reynolds suggests taking a breather.
“Wait for a good 72 hours. It’s like giving yourself a mini cooling-off period,” said Reynolds. “You’d be amazed how many impulse buys can be nipped in the bud when you’ve had time to mull it over.”
The 30-Day List
Got a Wishlist that’s threatening to take over your budget? Similar to the strategy above, Reynolds recommends making a list of those ‘wants’ and playing the waiting game.
“Give it a solid 30 days before hitting the ‘buy now’ button. More often than not, the urge to buy fades, and you find yourself saving some serious cash,” said Reynolds.
Cash-Only Challenge
Ever tried going old school with cash for your spending? Reynolds suggests challenging yourself for a set period and see how it transforms your spending habits.
“It’s like giving your wallet a reality check,” she added.
Jake Hill, finance expert and CEO of DebtHammer Consolidation, also subscribes to this technique.
“Although this may not directly boost your bank account,” Hill continued, “it does dramatically limit how much high-interest debt you take on.”
As a result, you’ll have more income left over for savings and investments, both of which Hill says are crucial for building long-term wealth and financial security.
The 50/30/20 Rule
“Imagine your income as a pie — 50% goes to needs, 30% to wants, and a sweet 20% gets cozy in your savings,” Reynolds advised.
“It’s like having your financial cake and eating it too. This rule helps keep things balanced and keeps your savings on the priority list.”
The Windfall Principle
According to Linda Schroder, real estate investor and owner of Cash for Houses, if you receive an unexpected tax refund of $1,000, you can apply the Windfall Principle by allocating 20% ($200) directly into savings instantly.
Schroder explained, “This disciplined approach ensures that unexpected financial gains contribute to your long-term financial goals.”
Reverse Budgeting
Reverse budgeting is another strategy that Schroder recommends trying. She said, “This method not only builds a financial cushion but also forces you to be mindful of spending within your means.”
For example, if your monthly income is $4,000, by prioritizing savings and allocating, for instance, 15% ($600) before covering expenses, you proactively ensure consistent savings growth.
The One-Percent Rule
Feeling strapped by your budget? Reynolds said, “Saving money doesn’t have to feel like a financial straightjacket.”
She suggests trying this: up your savings by just 1% of your income each month. It’s a slow and steady climb to a healthier savings account without feeling like you’re missing out on life.
Create a No-Spend Week/Month
Experts recommend picking a week or month and declaring it a spending-free zone for non-essentials.
“On average, people spend about $50-100 a week on non-essentials like dining out or shopping,” said Schroder. “Implementing the One-Week Challenge could save you $200-400 a month, offering a substantial boost to your savings or debt repayment efforts.”
Reynolds agreed, saying, “It’s like a fiscal detox, helping you identify areas where you can permanently cut back and redirect those funds to more meaningful places.”
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This article originally appeared on GOBankingRates.com: Grow Your Wealth: 9 Savings Rules You’ve Never Heard Of
