DENVER — Build up an emergency fund. Review your subscriptions. Create a budget. You've probably heard plenty of common-sense advice recently about how to save money, especially during a time of economic turbulence. So Denver7 is going a step further, and finding some less obvious ways you can keep your spending and saving habits in check.
We spoke with Neal Weber, the chief financial officer at Blue Federal Credit Union. Weber offered four major pieces of advice:
Use technology to automate savings
Weber said whether it's transferring money between accounts or making investments, automating your payments can help you save without putting in too much effort. "Ensure you're always paying yourself," he said.
But Weber says always make sure you're still paying attention to how much money you're moving around.
"Be sure that automating your financial life doesn't reduce your engagement with it," he explained. "It can be easy to set it and forget it, but good financial planning requires regular reviews of your budget and your spending to ensure you're staying on track."
Create better lifestyle habits
Whether you're online shopping or grabbing a snack while running errands, Weber says small, frivolous purchases can add up quickly. Weber offered some perspective: "Buying a $5 coffee every day can seem inconsequential, but what is the total cost of doing that every day for a year?"
He said being more conscious of these small purchases can help you save money over time, but many people often get caught up in easy, convenient spending too.
To curb online shopping habits, Weber suggested removing any saved credit cards, so you have to take an extra step before you click buy and the purchase becomes less automatic.
For any kind of impulse purchase, whether online or in person, Weber says you can give yourself a waiting period before you buy.
"This can be as short as 24 to 48 hours, or as long as 30 days," he explained. "It can give you time to think about the purchase, and if you still want it after the waiting period, then you'll be less likely to regret the purchase afterwards."
Learn to recession-proof your debt
It may be intimidating, but Weber says a time of economic uncertainty is actually a good opportunity to look over any debt you have. He suggests working with someone at your bank or credit union to look over the interest rates on your debt.
"We have seen many interest rates come down over the past 12 months," he said. "There may be opportunities to lower your interest rate and lower your payments."
Weber also suggested you focus on paying off high-interest debt, like credit cards, first. He also says you should keep an eye on your credit score, and work on improving it over time.
Be careful of "lifestyle creep"
Weber said when people get a raise at work, they often make lifestyle changes too, including spending more money. He calls it "lifestyle creep." But, he says that's not always the best decision.
"It can be a great opportunity to use these raises to improve your financial picture," he said. "Increases in spending often have short-lived effects on your happiness, but these increases can often prevent you from reaching your goals."
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