Want to give your savings a mega boost? Read on to see how to pull it off.
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It’s common to set lofty savings goals ahead of a new year. And research from The Ascent finds that Americans have some pretty big objectives on their radar for 2024.
A good 16% are resolving to save for a significant milestone, like buying a home. And 8% say they want 2024 to be the year they build an emergency fund.
Your goal, however, may be to close out 2024 with an extra $10,000 in your savings account. And clearly, that’s going to take some work. But here’s how you might be able to pull it off.
Step 1: Put saving your entire raise on autopilot
Ideally, you’re getting a raise in January, whether due to a stellar on-the-job performance in 2023 or a general cost-of-living boost that’s company-wide. If you want to meet a giant savings goal, the best way to start is to bank your entire raise. Since it’s money you’re not used to spending, you might as well sock it away.
Now it’s best to wait until you receive your first paycheck in 2024 before setting up an automatic transfer. But let’s say your first monthly paycheck arrives and it’s $142 higher than your old ones. That’s the amount you’ll want to arrange to move out of your checking account each payday and land in savings. But you’ll want to get that transfer set up before you get used to the extra money.
Step 2: Cut a major expense
You’re probably not going to save $10,000 in the course of a year by canceling a streaming service and ordering one fewer takeout meal per month. Meeting a goal like that could require a big change in your monthly spending. So to that end, see if there’s a large expense you can reasonably reduce.
It may not be possible to find a cheaper home where you live and work. But getting a roommate may be possible. If you pay $1,600 a month in rent right now, that potentially frees up $800 a month just like that.
Another option is to see if you can get by without a car and unload yours. AAA says it costs an average of a little over $1,015 per month to own a vehicle. If you work from home and only need a car to run errands and attend certain social events, crunch the numbers.
Let’s say you’ll need 10 Uber rides a month at a cost of $30 a pop to manage without a car of your own. Well, that’s $300 a month instead of $1,015.
Granted, owning a car may not be costing you $1,015 a month, especially if it’s paid off. But it pays to see if relying on a combination of Uber, rides from friends, and your own two feet makes it possible to ditch your car and save money.
Step 3: Embrace the gig economy
Just as the money you get in raise form isn’t money that’s earmarked for existing bills, so too is money from a side hustle you take on available to be saved. Explore your options for a second job in the new year, keeping in mind that the gig you pursue should be one that works for your schedule.
Let’s say you work long hours at your main job. Waiting tables at a local restaurant three nights a week may not be doable if you commonly get stuck at the office late. In that case, a job you can do at your own pace, like data entry from home, may be a better bet.
You might also find it easier to only have to work at a side hustle for one weekend a month rather than throughout the month. In that case, you could look at weekend gigs like working at a catering hall or house-sitting.
Growing your savings by $10,000 could put you in a much stronger financial position by the end of 2024. And if you stick to these steps, you may find that your goal is surprisingly attainable.
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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Uber Technologies. The Motley Fool has a disclosure policy.
