Saving When Times are Tough

For many individuals grappling with financial challenges, the idea of saving money can seem like an unattainable luxury. However, neglecting your savings when the going gets tough can make things even more difficult down the line. Here’s why you should continue saving through financially challenging times and practical steps for making it happen.

Why you should continue saving when the going gets tough 

• Be prepared for emergencies

Life is a roller coaster ride, and you never know what’s waiting for you just around the bend. 

Having a financial safety net will help you weather nearly any eventuality with your finances intact.                         

• Build financial discipline

If money is tight now, chances are you can stand to be a bit more disciplined with how you spend it. Setting aside money for savings each month, even if it’s just a tiny bit, can help foster financial discipline and cultivate a mindset of planning for the future. 

• Practice reaching financial goals

When there’s barely enough money to get through the month, saving up for something big can seem ridiculously out of reach. However, setting and reaching small financial goals can be a powerful motivator for fiscal responsibility. 

How to save during times of financial difficulty

• Start small

Experts recommend putting upward of 20% of one’s monthly income into savings, but if you’re struggling just to make it through the month, you can ignore this advice. Instead, start small, with as much as you can manage a month, and work your way up from there.  

• Look for ways to trim discretionary and non-discretionary expenses

If you feel like you’ve already exhausted all opportunities to trim the fat, think again. Look for unnecessary subscriptions, expensive products that can be swapped for cheaper generics and DIY options instead of paying for services and products. 

Next, review your non-discretionary expenses. Reach out to your insurance companies to negotiate for a lower premium or shop for a new, cheaper plan, and do the same with your phone and internet service providers. Look for ways to conserve energy and make an effort to carpool or move more and drive less to decrease fuel costs.

• Boost your income

Another obvious way to improve your financial circumstances is to make a sincere effort to bring more money home. You may be working a full-time job, but devoting even a few hours a week to a side hustle can make a big difference in your monthly budget. Consider freelancing for hire, working for a ride-sharing company over the weekend or hiring yourself out as a consultant in your chosen field. 

• Explore government assistance

 In times of financial hardship, it’s essential to be aware of government assistance and support programs, such as food stamps. These programs may provide temporary relief, enabling you to allocate a portion of your income to savings. 

• Seek financial guidance

If you find yourself struggling to make ends meet, consider seeking professional financial guidance. Financial counselors or advisors can help you create a realistic budget, explore options for debt management and provide personalized strategies for saving.

Use the tips here to learn why and how to save during times of financial stress.