Seventy percent of Americans have less than $1,000 in savings and 45 percent have no savings at all. Do you fall in these categories?
Is it better to pay off your debts now or save for a rainy day later?
Money experts say it’s better to establish a long-term savings plan to save money for emergencies. Having no savings means you may be forced to collect new debt if financial emergencies pop up.
So, what can you do to save money? Adding speed bumps to spending can get your brain motivated to save.
Instead of saving your payment info on online stores, set it up so you have to manually enter your credit card each time you make a purchase. The task of having to do so may deter you from spending the money.
Set up automatic payments to your savings account, so you won’t have to rely on willpower or memory to save.
Also, keep a money diary on where your money is going.
“Putting it in writing and sharing your values, I think that’s really the key,” said Celine J. Pastore with RFC Simplepath Retirement.
Finally, cash is king. People spend up to 100% more when using credit cards instead of cash. So, ditch the plastic and your bank account will thank you.
According to neuroscientists from Stanford, MIT and Carnegie Mellon, when you pay with a credit card, the pleasure parts of your brain light up. However, when you pay with cash, the parts of the brain that deal with pain light up.