TWLC Money: 5 Savings Tips When You Don’t Make A Lot of Money
With the exception of kids, I am no different than my driver last week or the female manager at the nearby Kinko’s: it is virtually impossible for these single moms and I to save money for retirement or the “rainy day” fund when we’re struggling to pay rent or put food on the table.
Some of us are working more hours for less pay or stuck for years at the same salary. Others are freelancing, temping, consulting, or starting businesses which can mean little, zero, or negative cash flow and out of pocket health or retirement benefits.
Gracias Brutal Recession and Anemic Economic Recovery.
¡Love ya back, New Economy!
How to save when I barely have un dólar to spare a day?
5 Ways to Save When You Don’t Make A Lot of Money
- Plan your daily budget and financial future NOW whether you have money or not: Yes, ahora, not when you secure that full-time job, promotion, raise, or big contract.
- Prioritize debt and savings: Ask yourself, is my debt under control? Maybe the answer requires analysis: a mortgage payment and taxes costing no more than 30% of your monthly income is different than thousands in credit card debt ballooning each month with late fees and 30% interest.
- Create an automatic savings habit: 10% may not be realistic for your budget today. How about 1% or $4 a day? Bring coffee to work and stash your daily Starbucks money in a savings account. The key is to create a money ritual that you can later increase when you get a raise or discover extra money through creative budgeting.
- Create a “confidence fund”: The unemployed did not only lose income, they lost skills. Save money to reinvest in yourself in the form of learning new skills. Whether it’s writing media reports, learning the website platform WordPress, effective social media outreach, editing videos on Final Cut Pro, or writing editorials, as founder and editor in chief of The Wise Latina Club, I’ve had to master new skills.
- Save each month or with each payment in a Tax/Benefits Fund to pay the IRS or your health benefits. You may still need to shell out some cash, but with some money put away, you’ll be partly there
Chicas, be conservative with your money which is not foreign to us because we come from familias that got ahead by earning each cent and building wealth through hard work and frugal spending habits. Also, seek professional advice from a financial planner, one who is fee-only as opposed to one who collects product commissions.
I got this savings advice from Money expert Louis Barajas who shared them with me when I guest hosted NPR’s Tell Me More with Michel Martin. Click below to hear the interview which aired on April 12, 2012.
This is the inaugural post of the original The Wise Latina Club Money series which I created because the time has come for Latinas to change our money mindset from just consuming products and enriching others to building wealth. We must think about investing to strengthen ourselves, our families, and communities through savings, buying a piece of property, or committing to a college or retirement savings plan. TWLC Money aims to get you thinking about and give you the tools to achieve financial literacy and independence. Click here to read more TWLC Money posts.Can you add a savings tip?