By making just a few small changes, you can reduce $100 from your monthly budget. However, make sure you don’t let the savings go to waste! Here are some ideas on how to put that money to work to improve your financial picture:
Pay down debt. If you have any debt, especially high-interest debt, you want to get rid of it as soon as possible. Paying an extra $100 towards your credit cards, student loans or mortgage will help you reduce the principal by over $1200 in just one year!
Increase your retirement contributions. Retirement comes a lot faster than any of us want to admit, but the earlier you save, the better off you’ll be. If you add an extra $1,200 to your retirement accounts each year for even just five years and realize an 8 percent annual growth rate, you’ll have an extra $48,000 in your accounts 30 years from now!
Save for college. Tucking away a little bit each month for college now will help a lot when the time comes to send your kids off, even though it may seem far away. If you have a newborn, putting $100 each month in a 529 plan from now until they are 18 will lead to almost $45,000 (again, assuming 8 percent annual gains).
Improve your house. If you’re already doing a good job of saving, one way to put your money to good use is to make useful improvements to your house, eventually increasing its resale value. You could look at making energy-efficient improvements that save you money on your utilities or giving the outside a fresh paint job.
Whatever you decide to do, just remember that making good decisions with your extra money now will help a lot down the road!
LincolnParkAnnie is a freelance writer focused on how to live large on a little living. She writes financial savings tips for the short term loans company, QuickQuid, and enjoys finding new ways to have fun on the cheap in her native Chicago.
I’m worst at budgeting. How I wish I could easily follow your tips heehee!