How to Save Money Even When You’re Broke

It is no secret that living expenses have risen faster than wages in recent years. That disparity has left more and more people living paycheck to paycheck, unable to save any money or stay ahead of the bills. For those just entering the workforce, the mismatch between wages and expenses has made it harder and harder to contribute to retirement funds, build college funds for the kids or even establish a reliable emergency fund.

The good news is that there are ways to save even if you think you have no extra money.

From giving up expensive and potentially dangerous habits to enjoying the tax savings that come with retirement plan contributions, there are plenty of ways to scare up a few extra bucks each week.

It does not take much money to get started saving. Often putting away that first dollar is the hardest part. Once you establish a regular savings habit, you may find that ramping up the amount you contribute is easier than you would have thought.

Use a Tax Savings Calculator
Many workers do not contribute to their 401(k) retirement plans because they fear that their paychecks will be much smaller. That may not be the case, since every dollar you contribute to your workplace retirement plan is deducted from your taxable income.

You can use any number of free online calculators to determine the real impact of a proposed 401(k) contribution on your take-home pay. All you need is your annual salary, the percentage you plan to contribute and a recent pay stub .You might find that contributing a couple of percent to your retirement plan will have a negligible impact on your spending cash.

Adjust Your Withholding
Once you have lowered your taxable income by contributing to a 401(k) or other workplace retirement plan, you can put more money in your pocket right away by adjusting tax withholding with your employer.

Just ask your human resources department for a new tax withholding form and adjust the amount taken from your check. You might end up with a smaller refund next year, but you will have more money to spend all year long.

Give Up Smoking
If you are a smoker, you could be spending thousands of dollars a year to fund an unhealthy and expensive habit. Just think about how much you could buy with that money; it just might make kicking the habit easier.

Smokers also pay more for health and life insurance, so giving up your cigarettes could save you even more money in lower premiums. If you need help quitting, your heath insurance company may provide the smoking cessation materials you need free of charge.

Set Up a Coin Jar
Piggy banks are not just for kids. You can use the same saving strategy that served you so well in your younger years by setting up a coin jar. Whenever you spend any money, take the change you receive and put it in your jar. Take your jar to the bank every week and use that found money to fund your savings account or emergency fund. .

These ideas can help you save money day after day, week after week and year after year. No matter what you do for a living or how much money you earn, making saving a regular habit is one of the best ways to secure your financial future and finally break the paycheck to paycheck cycle.

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