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Resolutions 2014: 4 simple tips to fatten your bank account

The best time to start saving money? Ten years ago. The second-best time? Today. Use these tips to turn your finances around in 2014.

By MSN Money Partner Jan 10, 2014 12:49PM

This post comes from Donna Freedman at partner site Money Talks News.


Money Talks News on MSN MoneyYou want to save. You swear you're going to save. But you said that last year, too, and your bank account doesn't look much healthier.


Saying "I need to save" means you've recognized a basic financial fact: You need to take responsibility for your financial life. You really intend to do it -- one of these days. (Read: Sometime between next week and never.)


Or maybe you're just financially overwhelmed, especially if you haven't gotten a raise lately or if you've undergone a spell of unemployment. It's easy to convince yourself that you'll save "later."


The best time to start saving money? Ten years ago. The second-best time? Today.

Want 2014 to be the year you turn things around? Four simple tactics can make all the difference.


Step 1: You need a goal

The first thing to do is set a specific goal. "In 2014 I'm going to start an emergency fund" or "I resolve to have a healthy bank account this time next year" are both fatally vague. How much of an EF? What's a "healthy" account? Try this instead: Pick a specific sum. It could represent, for example, your emergency fund, the cost of a long-deferred vacation or a down payment on a house. Your choice.


You could divide that amount by 12 and put that result into savings each month. Or you could divide that goal by 52. Why 52? Because a small, weekly savings plan is less traumatic than a once-a-month withdrawal. You learn to live on what's left week by week, vs. losing a (relatively) big chunk all at once.


Person withdrawing cash © Image Source/Image Source/Getty ImagesLet's start with an easy example: the $500 that personal finance writer Liz Weston recommends as a starter emergency fund. Divide $500 by 52 and you get $9.61, which rounded up makes $10.


Step 2: Pay yourself first

The old saw holds true: Pay yourself first. Otherwise that "extra" $10 will get spent on something nonessential, like a pizza.


Or even for something essential, like rent. Paying yourself first forces you to get smarter about the way you let money slip away each month.


Step 3: Automate

Automate a weekly withdrawal of $10 (or whatever your selected amount is) from checking to savings. Why automate it? Because that way it's sure to happen every week or month. Treat your savings like any other bill -- utility, credit card -- that you pay online.


Step 4: Track your expenses

Track your expenses with a free service like our partner PowerWallet, which shows you where your money is going. Now you can look for ways to save on everyday expenses.


Earn more or spend less? (Why not both?)

A recent survey from CareerBuilder indicates that 36 percent of U.S. residents either always or usually live paycheck to paycheck. If you're in this situation you might wonder how to find that $10 per week.


Let's turn that idea on its head: If you had an emergency, how would you find the however-many-dollars it would take to fix things? Better to sacrifice $10 a week than to have to come up with $300 all at once.


Even if you're not in that situation, you'll need to find ways to set extra money aside to meet your goal. Here are a few ideas to get you started:

  • Pick up extra work. If extra hours on the job aren't available, you can find other ways to earn more money. Dog walking, house cleaning, lawn mowing, delivering newspapers and the like are all tried-and-true methods. Try thinking outside the box, though. I once interviewed a woman who walked several neighborhood kids to school; since she had to walk her own daughter, she was earning money for doing something she did every day. Smart.
  • Cut back on eating out. Way back. Cooking at home is much, much cheaper. Can't cook? Go online or to the library for easy recipes. Do this gradually if you're a total restaurant junkie. For instance, cook two times a week at first (and make the meals big ones so you'll have leftovers to carry to work).
  • Cut other everyday expenses. Trim TV costs by ditching cable (or at least negotiating for a better deal). Use discounted gift cards to pay for goods and services. Look for cheap or free ways to entertain yourself.
  • Look for savings elsewhere. For instance, find ways to save on car and homeowners insurance.
  • Use coupons. Sites like CouponMom.com and Favado do the work for you by matching coupons (often downloadable) to sales at supermarkets and drugstores. (I never pay full price for toiletries.) Incidentally, there really are coupons for healthy foods, including organic products.
  • Sell stuff. On eBay, on Craigslist, on the supermarket bulletin board. Sell books through online used-book sites.
  • Tell yourself "no" more often. Well, scratch that: Tell yourself "not now" or "not today" when you're itching to buy any unnecessary item. Don't stop treating yourself entirely -- just pick your spots.

Try one new tactic at a time until you're confident you can pry that $10 -- or whatever amount you've picked – from your budget. Watch that savings account creep up. If through luck or diligence you find a little extra money in the budget some weeks, shoot it over to savings.


Pat yourself on the back (just a little), but don’t consider the matter closed. Instead, keep looking for ways to increase your savings. Even if it's only $11 a week instead of $10, that's an extra $52 per year. (Hint: Slow growth is better than no growth.)


Yes, it can be tough. But it gets easier, or at least becomes second nature to pay yourself first. If times are tight, don't let that undermine a better future -- and that future starts now.


More on Money Talks News:

52Comments
Jan 10, 2014 9:23PM
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How the f*** can you fatten your bank account when Gas and Electric goes up every year, food goes up every year, cable, internet and phone goes up every year, car insurance goes up without you having an accident, gas is too damn high and yet the company you work for find ways NOT to give you a decent raise while the higher ups are taking European and other exotic vacations!
Jan 10, 2014 3:35PM
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It may be awesome if we, one day, move from these pre-kindergarten level "tips" to something with a little bit more meat.
Jan 10, 2014 7:16PM
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I think the way to wealth is to become a government employee, specifically a congressman.
Jan 10, 2014 6:10PM
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I know another way: Put it under you mattress and the Gov. won't know how much you have , they can take there 1/4 % and shove it up there asses.
Jan 10, 2014 7:22PM
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Put 5% of your gross income into your 401K, more if your company matches. Put 10% of your gross income into an emergency fund until it's 6X your minimum monthly expenses, then start putting the excess into safe investments. Treat this as bill number one, no excuses.

In five years your life will be dramatically different. You won't worry about your car breaking down, a big unexpected bill will be no big deal, and you'll shake your head in disbelief at how much your friends suffer with self-imposed money problems. It's really that easy.

Jan 10, 2014 8:25PM
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Put all of Congress and the Banksters in jail 4 to a cell, that should help tremendously.
Jan 10, 2014 7:34PM
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First of all, don't spend more than you make. Second, no credit cards. It's always a good idea to have money set aside in case of an emergency. Third, don't buy things you don't need. Most importantly, keep most of your money invested, but watch it on a daily basis. The key is to try to keep your money working for you.

Jan 10, 2014 7:24PM
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Best way to fatten your bank account is to make more money.....get a second job part time, start a hobby you enjoy that pays you extra income. When you get a raise start saving half of it, painless. Plan ahead and stash a little back....don't borrow money and pay interest for things you don't need. Many ways to save, find something that works for you..  
Jan 10, 2014 2:44PM
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why didn't I think of that......

Seriously!

Jan 10, 2014 5:48PM
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I love some of these but ditching cable when you live in a very rural area just isn't feasible.  Internet and cable or very expensive or those of us who live in small towns or actually out in the country.
Jan 23, 2014 8:50AM
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Cancel your cell phone contract, drive a clunker, build a shed and live in it, raise chickens and rabbits and eat them.

Jan 13, 2014 8:42AM
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What is all this with work and save?  Under today's administration it is better to maximize the amount of free time you have.  Your retirement is already taken care of with 99 weeks of unemployment and SSI, your food bill is taken care of with SNAP, your medical insurance is taken care of with ACA, your education is taken care of, your housing is taken care of with section 8, your cell phone is taken care of with your Obama phone.

 

If you decide to work and save just look to your left and right one of the people standing next to you is not and it takes an ever growing centralized federal government to ensure that you pay for their benefits.

Jan 23, 2014 11:58AM
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All good suggestions.  My 2 cents worth - shop at Good Will, only eat out on special occasions, always pay cash for a car (never a new one), walk a half hour per day and eat a proper diet (less doctor co-pays, prescriptions), ditch the land phone, keep your heat at 65 degrees or less (78 degrees for air), if you use credit cards, be sure to pay in full each month and use cards with rewards (I've paid for 1/4 of my Christmas shopping this way), clip coupons.  There are tons of small ways to save that add up big.
Jan 10, 2014 10:57PM
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I fattened my bank account by closing it and taking my money and putting it where it will actually grow! I made $100 in just two months (legally LOL!) , which isn't a huge amount to the top 1%.  To me It is better than less than a buck a year in and bank savings account!  Duh!
Jan 10, 2014 9:26PM
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.

never mind, I'm not telling what I have. it will but enough, it will  take care of me and my family for quite a while

I am  not rich but I have put $ away for awhile and I know how to protect  my family and I will give my life to preserve my and my family's right to live the way they want to. come hell or high water I will protect  what this country that was founded on, and that is the freedom of the people to choose how they will live and not how some politician tells ' them tells how to live. this country was founded for the people by the people and I am 46 year veteran of this country, and I am sick and tired of the  way  the people of this USA are being treated. we have freedoms that were provided by the

second ammdenent to protect ourselves from harm. what choice do Have 



protect  


Jan 10, 2014 8:14PM
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The two best ways to fatten them up, own a bank, or be a Corporate Douche bag CEO, like pretty much everyone except Costco.
Jan 10, 2014 6:47PM
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I make really good chocolate chip cookies. I am going to start feeding my bank account my cookies and milk. I think I can fatten my account with some of those delicious cookies. I buy food and gasoline because I have a car still and I do not spend money on foolish things. I do not know what else to do to fatten my bank account.
Jan 10, 2014 6:24PM
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I misread this and thought you said flatten your  bank account.
Jan 23, 2014 10:08AM
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I wonder how many government employees had to give up their movie night and eating out to save a buck? If Obama wouldn't have destroyed our country we wouldn't have to support so many government workers and welfare recipients. Best way to save money is to get government out of our pockets for everything that we buy an do. It is a complete shame what has happened to America on the Communist watch.
Feb 5, 2014 6:23PM
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There are no shortages of fossil fuels except in the minds of corporate America. They are trying every gimmick from fake fires at refineries and shortages of gas lines and trucking problems due to weather in order to price gouge the consumer. For instance in natural gas the companies have for three years been talking about cutting production because it is so abundant and the price so low. It is all a big rip off and this greed is ruining our country.
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