It pays to make saving a habit. Look for easy ways to build saving into your life and to make it automatic.
3 ways to make it easier to save
1. Pay yourself first
Use online or mobile banking to set up your own monthly savings program. Make an automatic transfer from your chequing account to your savings account on your payday. That way your savings is taken care of before other discretionary spending.
You can change the amount you transfer each payday, as your budget changes.
Setting up automatic payments helps create default financial decisions that work in your favour.
2. Check for savings apps
Your online banking may include apps for budgeting and saving as part of your services. Some debit cards also round up transactions to put the remainder towards your savings.
Make sure you’re comfortable with the privacy settings of any app or automated savings steps.
3. Join a savings plan at work
Find out if your workplace offers a savings plan. With this type of plan, your employer would take money from your pay each month. With some plans, your workplace might contribute to your plan each month. The money may go into a savings account, or it may be used to buy mutual funds.
Learn more about workplace pension and savings plans.
7 ways to find money to save
There are a few easy places where you might be able to save money, including:
1. Use unused gift cards
Many Canadians have gift cards sitting unused in their wallets or drawers at home. Check the balances and put them towards some of your purchases in the next month. The money you save could go towards your savings account or a debt payment.
2. Use unused points
Just like the gift cards, many of us have rewards points collecting. Make a list of the accounts you have points — grocery store or drugstore loyalty points, credit card rewards points. Even the cafes or restaurants you frequent may have rewards cards. You might be able to manage a whole week’s worth of expenses or more by cashing in points.
3. Review your bills each month
It can be eye-opening to sit down and check how much recurring expenses really cost, such as your cell phone bill or streaming services. Rather than trying to tackle them all at once, pick a different one to review each month. See if it’s something you could cut back on or get reduced. For example, switching to a new cell phone provider or a different plan.
4. Turn some everyday expenses into “some days” expenses
Most of us have things we spend money on every day or every week. Rather than cutting them out altogether, decide what you can cut back on. For example, if you enjoy getting takeout coffees, try getting them only on Monday, Wednesday and Friday instead of every day. See how your savings add up.
5. Make the most of five Friday months
If you’re paid weekly or bi-weekly, there will be some months of the year where you’ll receive one more paycheque than usual. For example, if you’re paid bi-weekly, most months you’ll receive two paycheques. But there are two months of the year when you’ll receive a third cheque.
If you build your monthly budget around four Friday months, then the months with an extra paycheque will be a great opportunity to save.
6. Find your magic trade-off
There are many kinds of spending trade-offs. But the more important thing is to find the ones that will “stick.” For example:
- Leaving the car at home and walking or taking transit more.
- Using your library card instead of buying books online.
- Meeting friends for walks outside instead of at a restaurant.
- Rotating your subscription services every few months so that you’re only paying for one at a time.
7. Plan your tax refund
If you’re expecting a refund at tax time, this is a great chance to top up your emergency fund. Or you could use it to save for a large purchase, or make a contribution to your TFSA, RESP, or RRSP.
It pays to turn saving into a habit. Even small savings add up over time. See what happens if you set aside just $5, $10, $20, or $50 a month.
|If you save this much each week||You’ll have this much in a year|
Saving just $10 a week can add up to a small emergency fund by the end of the year. That fund could be enough to help you through a tough week or handle an unexpected expense.
Learn how your savings can grow with compound interest.
Consider these three ways to make saving easier:
- Make saving automatic
- Use savings apps
- Join a plan at work