A person should save at least 10% of their income or more, but the Federal Reserve has reported that Americans save just 5.3% of their income. And to save a significant amount of money, one has to make strict financial decisions and look for ways of supplementing their income.
And this is a brief overview that looks into the ways you can save $10,000 in one year. So check them out and let me know what you think!
Find Cheaper Housing
One of the critical steps in achieving your savings goals is to limit your housing expenses. Most people will spend an average of 37% of their total income on housing.
However, your housing should cost 25% of your after-tax income. So consider moving to a less expensive home, sharing an apartment, or even living with your parents depending on your situation.
Making significant changes to your housing expenses can account for substantial savings and enable you to live a comfortable life in the future.
Earn Extra Income
One of the best ways to make extra income is by getting a freelance job online. So for instance, there are people who specialize in academic writing, and it helps them gain more income than at their day job.
Another way to earn extra income is by doing online surveys. You can use platforms such as Swagbucks and complete simple tasks to earn money.
There are also other online opportunities such as blogging, drop shipping, or creating a YouTube channel. And while things like blogging do not earn you money immediately, if you are committed and consistent you can make significant amounts of income doing something you love.
Reduce Transport Costs
Studies by the American Automobile Association (AAA) found that owning a small car can cost a person around $6k a year. This cost can double or triple depending on the size of your car and other factors such as insurance and maintenance among other related expenses.
So a great option would be to use an eco-friendly bicycle or public transportation as it saves you on gas, maintenance costs, and even the cost of purchasing a car.
Avoid buying brand name products
You can get generic versions of brand named products. In most cases, the ingredients used in making the generic products are similar to those used in making the brand products. Brand products are just expensive due to their names, and this can save you significant amounts of money.
Time Instead of Dollars
View your purchases as costing you time instead of money. Take for example a new iPhone which costs around $800. This would cost you 60 hours of work, so you need to know if this is actually worth your time.
Independent Insurance Agent
Choose an independent insurance agent as they are cheaper and will help you find the best insurance for your money. They’re not just limiting you to one insurance company which can charge you as they like.
52-Week Money Saving Trick
This challenge requires you to save $1 in the first week and then save an extra dollar the next week (so $2 for the 2nd week, $3 for the 3rd week, etc.). And by the last week of the year, you will save $52 (it being the 52nd week of the year). By the time you are completing the challenge at the end of the year, you will have saved $1,378!
If you have the ambition and the right tips, you can save $10,000 in just a year. So, are you up for it?