5 min read
How to Start Saving Money: Clever & Easy Steps
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If you vowed this is the year you get ahead financially only to watch payday deposits disappear, you’re not alone. Gillespie (2025) notes that 59% of Americans still can’t cover a $1,000 emergency without borrowing or selling something. Meanwhile, the U.S. personal-saving rate is languishing below 4 percent—about half its long-term average (BEA, 2025). These sobering numbers explain why learning how to start saving is so critical. The encouraging news? A few clever ways to save money can transform vague intentions into steady progress.
Lesson Notes:
- Define SMART financial goals to guide purposeful saving.
- Create a flexible budget prioritizing savings before discretionary spending.
- Automate savings deposits and eliminate wasteful expenses, subscriptions, and debts.
- Increase your earnings via side hustles and direct the extra income to savings.
LESSON CONTENTS
Identify your financial goals
Every journey needs a destination. Before trimming lattes or hunting coupon codes, clarify where your dollars should ultimately land. Psychology researchers find that vivid goals trigger the brain’s reward centers more powerfully than abstract wishes, boosting follow-through. List your goals in three tiers:
- Safety first: a $1,000 starter emergency fund, then three-to-six months of essential expenses.
- Near-term dreams: a ski weekend, laptop upgrade, or moving costs within 12–18 months.
- Big milestones: home down payment, wedding, or grad-school tuition set several years out.
Tips on how to save money that stick require SMART goals. Set realistic goals and attach a dollar amount and deadline to each. For instance, saving $9,000 for a new car in 30 months means $300 a month. Naming targets turns that behavioral lever in your favor. Remember, goal setting is your first practice run at how to start saving; give it purpose, and the habit takes root.
Create a budget that works for you
Clear goals need a cash flow map. The classic 50-30-20 rule — 50 percent for needs, 30 percent for wants, 20 percent for savings and debt payoff — is a popular starting point, yet few households fit it perfectly. Think of it as a guideline, not gospel. Start by exporting three months of bank and credit card transactions, group them into needs, wants, and goals, then adjust:
- If housing in your area gobbles 45 percent of take-home pay, trim wants to a lower percentage.
- Funnel windfalls such as raises, bonuses, and tax refunds straight into savings buckets.
- Review categories weekly; small corrections beat end-of-month panic.
Prioritizing building savings in the budget’s top line rather than saving whatever is left is the best way to save money because it insulates your goals from lifestyle creep.
Automate your savings
Automated savings is one of the most underrated and clever ways to save money. It’s effective because it removes willpower from the equation, and modern technology makes implementation effortless. Most banks and credit unions let you schedule recurring transfers on payday — a tactic known as “paying yourself first” because you never see the cash long enough to miss it. Set up two automations: one to a high-yield savings account for short-term goals and another to a workplace retirement plan or IRA set up for saving money for the future.
You’re more likely to stick with a plan because it happens in the background — out of sight, out of mind. Within a few pay cycles, you’ll realize how saving can feel as routine as paying the electric bill. Revisit the amounts every quarter and increase them whenever you receive a raise.
Cut down on unnecessary expenses
High-interest debt and silent subscriptions sabotage progress. Attack them methodically.
Track your spending
Begin with a 30-day audit using your bank’s categorization tool, a spreadsheet, or a free app – you may be surprised by items you have overspent on. A key category for cost savings is your subscriptions. A Motley Fool survey found that a third of Americans spent over $100 monthly on subscriptions (Caporal, 2024). However, most subscriptions, especially digital ones, go unnoticed and cost hundreds of dollars. When you see your totals in black and white, act immediately. Pause all unused streaming platforms, downgrade inflated phone plans, and rotate services seasonally to reduce spending.
Minimize recurring costs
Renegotiate insurance premiums, cancel add-ons you barely use, or bundle services for loyalty discounts. Lower utility bills by switching to LED lights, using smart thermostats, and behavioral changes like turning off unused lights. Direct every dollar you free up back into your highest-priority goal. This slow, deliberate pruning might not feel productive, but over 12 months, it’s among the clever ways to save money you’ll ever try.
Shop smart and save
Reducing your grocery bill is the best way to save money on shopping. Plan meals and use grocery lists, unit-price comparisons, and coupon apps. To save more, plan your major purchases during holiday sales like Black Friday or tax-free weekends in August and stack coupons with cash-back portals. Even a modest 2 percent cash-back card returns $200 annually on $10,000 of planned spending. Each micro-cut frees cash you can now reroute to your highest-ranked goal.
Boost your income with side hustles
Cutting expenses has limits; earning more can turbo-charge savings. A key way to earn more is by pursuing an extra income. The side hustle boom is no fad: 38% of Americans now earn extra money outside their primary job, earning an average of $1,215 monthly (Schulz, 2025). Consider side jobs like rideshare driving, pet sitting, online tutoring, freelance design, or renting out gear to earn more. Commit every extra dollar to priority goals rather than lifestyle upgrades, and you’ll watch savings snowball.
Not sure where to begin? Start small — one-weekend shift or three clients a month — and track income separately so you see its direct impact. Combining expense control with a side hustle is among the most clever ways to save money since it accelerates saving momentum.
Utilize saving tools
If you are wondering how to start saving, credit unions can super-charge your savings goals with resources like these:
- Money Insight App: Helps you budget, track spending, and monitor your savings goal progress.
- Savings, CDs, and Money Market Accounts: This credit union savings account and related products offer competitive rates, ensuring your cash grows faster while staying fully insured.
- Savings calculators: Plug your numbers into a savings goal calculator and see how your savings grow.
- Education Center: Financial coaching and expert tips on how to save money every day.
Frequently Asked Questions
What is the 50-20-30 savings rule?
It’s a general savings guideline that allocates 50 percent of take-home pay to needs, 30 percent to wants, and the remaining 20 percent to debt payoff or savings.
What is the best way to start saving money?
Combine clear goals with automated savings. Set a specific target, split paychecks so savings move first, and review progress monthly. Consistency trumps size; $25 every Friday beats sporadic $200 lump sums.
How much money should I aim to save each month?
Aim for at least 20 percent of net income. If that’s unrealistic, begin at 5 percent and raise by one point each quarter until you hit 20.
What are some effective ways to track my spending?
One option is your bank’s analytics dashboard. A second one is linking accounts to budgeting apps like YNAB and EveryDollar. Lastly, if you love working on numbers, use a spreadsheet tool like Excel.
How can I create a budget that I can stick to?
Establish expense categories based on actual past expenses and set a limit. Include savings as a priority and treat it as non-negotiable. Review your expenses weekly and adjust accordingly. Lastly, allow some “fun money” to reward yourself and avoid burnout.
What are some realistic side hustles I can start with?
Rideshare driving, pet sitting, freelance writing or design, tutoring, photography, or selling crafts online are side gig examples to generate extra cash.
Citations
Lane Gillespie (2025, March 26). Bankrate’s 2025 Annual Emergency Savings Report. Bankrate. https://www.bankrate.com/banking/savings/emergency-savings-report/
Bureau of Economic Analysis (2025, April 30). Personal Saving Rate. https://www.bea.gov/data/income-saving/personal-saving-rate
Jack Caporal (2024, November 12). Survey: Most Believe They're Overpaying for Their Subscriptions. Motley Fool. https://www.fool.com/money/research/survey-most-believe-theyre-overpaying-for-their-subscriptions/
Matt Schulz (2025, March 10). 2025 Side Hustle Survey: Nearly 2 in 5 Americans Have a Side Hustle, With 3 in 5 Saying the Income Is Essential. LendingTree. https://www.lendingtree.com/debt-consolidation/side-hustle-income-survey/
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