It’s no secret that Millennials don’t have a lot of money.
A new survey conducted by howmuch.net, a personal finance website, found more than 50% have less than $1,000 in savings. This means many Millennials lack a financial cushion to fall back on. But Tom Milinovich, a certified financial planner and public accountant, says it’s necessary.
“Having that cushion is very important, regardless of what age they are,” says Milinovich. “Not having one month’s rent or the deposit could cause them to be out on the street.”
Milinovich says developing good saving habits from a young age is crucial. But saving money is an acquired skill, he says.
“Even if it’s saving $50 a month, you need to force yourself to do it,” says Milinovich. “If you don’t, you’ll spend everything you get.”
Here are four creative ways Millennials can curb their spending and start to save — even if it’s only a few dollars here and there.
(LITERALLY) HIDE YOUR MONEY AWAY FOR A RAINY DAY
Summer Dupont, a senior at the University of Pittsburgh and part-time waitress, puts her spare change in a jar and deposits it into her savings account each time it gets full. It’s a technique that has proved surprisingly effective.
“I started saving [spare change] the summer after my freshman year of college,” she says. “The next summer I went to Montana and I had saved up $400 from my change and used that to pay for all my stuff on vacation
But you don’t have to just collect change. Stashing extra cash in a jar is also a good strategy. After withdrawing money for a certain activity, Lifehack suggests putting any leftover cash in a jar as opposed to putting it back in your wallet.
STAY THIRSTY, MY FRIENDS…FOR WATER
Pro tip: Ditch the soda and only drink water while dining out. Consumers spends an average $2.50 per drink at a restaurant, according to Daily Finance, and the average U.S household spends $850 annually on soft drinks, according to Drink Water First, an online campaign that encourages teens to drink water.
So, if you eat out twice per week and simply swap soda for water, you can save up to $260 annually.
USE TECH TO KEEP YOU ON TRACK
A number of budgeting apps exist that can help you stay on track with your savings. Free popular apps like Mint and PocketGuard, for example, give users comprehensive tools to monitor their finances even when they’re on the go.
Abigail Oesterling has been using Mint for four years and she says it helps her keep on track.
“I like being able to see all my information in one place,” says Oesterling. “My credit cards, my bank accounts, my retirement accounts — [the app] puts everything together in place and lets you categorize all your spending.”
Since the app separates spending into categories, Oesterling can pinpoint how much she spends on things like dining out or entertainment and where she needs to cut back.
“You may not realize how often you eat out or buy donuts,” Oesterling says. “But when you can track it over a month, six months, a year, then you can see you spend more on some things than you ever thought.”
PREPAID GIFT CARDS ARE YOUR FRIEND
Jessica Niederlander keeps her spending on track by purchasing a prepaid gift card at the start of each month. It allows her to keep her “fun” spending under control.
“I would buy myself one gift card a month under $100,” says Niederlander. “That would be my “me” spending. Everything else was on a need-to-need basis”
Written by Nika Anschuetz