Friday, August 14, 2009

Tips for saving money

By Dan Danford

We all know that we should save money, and most of us don't save enough. We should all have an emergency fund, and we should also have savings outside of that. For the past week or so on Twitter, we've been giving out tips on two things relating to that: first, what qualifies as an emergency, and second, tips for savings. We've compiled the tips below.

- Emergency funds are for true emergencies. What’s that? Something that threatens life, health or safety.

- What’s an emergency? You need to escape path of deadly hurricane and pay for hotel rooms.

- What’s an emergency? Your car dies, and you need to repair it so you can get to work.

- What’s an emergency? You break your leg, and need to pay hospital bills. (Although they will often negotiate payment plans.)

- What’s not an emergency? You need a new iPod or TV, couch, chair, carpet.

- Savings works best when it is earmarked for a certain purposes and a goal for a specific amount is set.

- Savings works best when you save a little at a time. Don’t let the size of the goal daunt you. Start small.

- Savings works best when it comes straight out of your paycheck. Have some direct deposited into your savings account.

- Savings works best when it comes straight out of your paycheck. Take advantage of work-sponsored retirement plans.

- Savings works best when you stay away from temptation. Stay out of consumer stores that sell expensive stuff you want but don’t need.

- Savings works best when you work from a budget. Don’t sabotage your good income by frittering away money.

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