Simple Savings

This article courtesy of Feed the Pig. Copyright 2011 American Institute of Certified Public Accountants.

ROYGBIV, My Very Educated Mother Just Served Us Nine Pizzas…mnemonics made it easier to remember the primary colors and the planets when you were in school, but what about in adulthood? With the added responsibilities, shouldn't there be more tricks to help us? Here are a few to try today.

The thirty day rule. Considering an impulse purchase? Wait thirty days and then ask yourself if you still need that item. Often the urge to buy will pass, saving you money and the aggravation of buyer's remorse. This trick can be especially handy when it comes to big ticket items, where you may be able to find it for less after your thirty day waiting period.

Tip trick. You're just finishing a relaxing night out when it comes time to settle the bill. Whether you're slipping into a food coma or engrossed in conversation, sometimes calculating the tip can seem like complex calculus. An easy trick: moving the decimal one place to the left in the total gives you 10%; you can then double it to get 20%, a handy starting point to round up or down from, depending on your preference. For example: Total = $40.00 à move decimal one to the left, $4.00 = 10% ($8.00 = 20%, $6 = 15%).

Savings starter. Looking to start saving but not sure how much? An easy rule of thumb is to put 10-15% of every paycheck into your savings account. This may sound like a lot, but there are inevitably going to be times when you are not able to save as much. Putting yourself in the mindset of saving more now will help saving become habitual in the long run. Try working your way up to saving one-third of your income every year; this is what many financial advisors recommend.
Bonus tip: you can use the tip trick to figure out how much you should save from each paycheck; just move the decimal place on your paycheck one to the left and commit that amount to your savings. $500 paycheck = $50 to savings for 10%, $100 for 20%.

And always remember to SAVE: Savers Always Veto Extras.

Visit www.feedthepig.org for more money-saving tips.

This article courtesy of Feed the Pig. Copyright 2011 American Institute of Certified Public Accountants.