Become a Better Saver With These 5 Small Changes

If saving more money or becoming a better saver, in general, is a big goal for you, the key to achieving it is to start small — with micro-habits. As the name suggests, micro-habits are small, simple actions that you can incorporate into your day-to-day schedule to steer you toward your goal and  help you form healthier behavioral patterns that can last a lifetime.

If you are looking to save more of your hard-earned money and thus move closer to your financial goals, here are five micro-habits that when built into your routine can help you get there. 

Micro-habits to Become a Saver

1. Save the Change

Make a rule that you will not spend any coins that you get back as change, only bills. At the end of the day, before you go to bed, go through your pockets, wallet, or purse and empty them of all change. Put all this change in a savings jar. If you follow this through, you can effortlessly and painlessly accumulate a sizable sum of money every month.

Once you've gotten into this rhythm, gradually increase the amount you put into the jar. For example, you could start putting all of your change plus the two lowest denomination bills into your savings jar. Or, instead of just saving coins, you can also start saving any dollar bills you get as change. And then fives, and so on.

With time, you’ll find yourself looking for ways to structure your transactions or purchases so that you can get some change to save. Once a month, or whenever you deem it necessary, take the cash you’ve accumulated to your bank and put it into a savings account.

You can also leverage technology to help you further with this saving micro-habit. Apps like Qapital and Chime, for example, will round up every single purchase you make to the nearest dollar and automatically transfer the difference to a savings account.

And if the idea of saving your change doesn't appeal to you, an alternative but closely related micro-habit that you can adopt to become a better saver is to make a fun game out of your spending.

You could, for example, decide to “pay yourself” 10% for every purchase you make. That means that if you spend $20 on an item, you’ll have to put $2 into a savings account for your future self. For every $100 you spend, you'll put $10 into your savings account, and so on. While it may not appear to be much at first, it can add up over time.

2. Put it on Autopilot

Another micro-habit that can help you build a lifelong habit of saving money is to automate the process. Automating the process of saving money means that you no longer have to rely on willpower to do it. That’s a very wise move because willpower is after all a finite resource that depletes over time and the more you use it.

Start by setting up a savings account that draws a specific amount automatically from your paycheck as soon as it hits your checking account. If you are self-employed or don’t have a fixed income schedule, you can set up the transfer to take place on a regular schedule, such as every two weeks or whenever a new payment lands in your account. Almost every bank offers this automatic transfer service. There are also many apps built around the same idea.

You can begin with a modest amount, $50 per month, and then increase this amount as time goes by, depending on your financial situation. In fact, there are apps such as Digit that will analyze your spending and income patterns, calculate how much you can afford to save based on those patterns, and then automatically transfer the amount to your savings account.

3. Learn a New Thing About Money Every Day

Learning something new about money every day is another micro-habit you can commit to that will yield big results in your savings journey over time. This could mean reading a personal finance book or an online article, listening to a podcast about personal finance, watching an expert YouTube video on saving money, or even just chatting with a friend about their own money-saving strategies.

You can start, for example, by committing to read or listen to a personal finance book or audiobook for at least 15 minutes every day. Do it during your downtimes, such as your lunch break or even while eating breakfast in the morning. Or, in the case of an audiobook or podcast, listen to one in the car during your commute. Find whatever time or location works for you and make this habit a part of your daily routine. As you get in the groove, 15 minutes of reading or listening to a book per day will grow into 30 minutes, and then 1 hour, and so on.

By consistently taking this small act of learning a new thing about money every day, you'll slowly but surely develop and gain useful knowledge and a strong understanding of money including how to save it. And as your understanding grows, so too will your money-saving ability and skills.

4. Go Lean in One Spending Category

If you’re trying to become more frugal, don’t try to make savings across all aspects of your life. Indeed, when trying to save money, it’s common practice to try to cut back on everything at once. You may, for example, decide to stop going out to eat completely, cancel your cable subscription, and start carpooling to work, all the same time. This approach, unfortunately, is more often than not, unsustainable. 

Trying to cut costs across the board can be overwhelming and will almost always lead to failure. You might feel so restricted that you actually end up giving up on your savings goals altogether.

A much better approach is to start small. Basically, zero in on one spending category where you can make some adjustments and go from there. For example, if you want to save on groceries, you could start by doing your shopping in bulk or joining a loyalty program. Once you've established a good saving routine in that area, you can move on to another category, such as transport or entertainment. 

Continue this way until you’ve established saving routines in almost all of your spending categories. In the end, saving money will become almost second nature to you.

5. Never Pay Full Price

If you're looking to save more money, one simple micro-habit you can adopt is to never pay full price, especially for big purchases. With so many coupon code sites, daily deals, loyalty programs, seasonal sales, and other deals available today, it's quite easy to get many things without paying full price. It only takes a little effort or, in certain cases, some patience.

Here are a few ways to not pay full price on items and thus save more of your hard-earned cash. Practice these small habits, you'll be amazed at how much money you can save over time!

• Sign up for email newsletters from your favorite stores (or follow them on social media) to receive coupons and promo codes for products.
• Join your favorite stores' loyalty program to receive discounts on future purchases.
• Learn about and start using coupons: You can visit your local stores' websites or use coupon aggregator sites like Slickdeals, RetailMeNot, Honey, DealsPlus, and CouponCabin to find coupons.
• Use price tracking websites: On a site such as CamelCamelCamel, you can search for and see the prices that an item has been sold at on Amazon over the last year. You can also set up email alerts for drops in prices.
• Make use of the live chat: If your favorite online retailer has a live chat tool on their website, use it to ask for a discount on certain items. You never know; you might encounter a kind sales rep who, after a little friendly chat, might be willing to give you a sweet deal on the item you want to buy.
• Learn about your favorite stores' sales cycles and plan big purchases around them. Most retailers, for example, will mark down prices or offer discounts or sales during the holiday season. So, if there’s no urgency to the item you want to buy, waiting to buy it until the holiday can save you a good amount of cash.
• Shop in incognito mode. This prevents online sites from using cookies to track your browsing and search history and using the info to set potentially higher prices for items.
• Abandon your shopping cart: If you put items in your shopping cart and leave without checking out, many brands will often reach out to you with a personalized discount or some type of offer to encourage you to complete the purchase. You’ll need to sign into the site, however, or register through a legit active email to enjoy this.
• Use cashback sites: Instead of accessing a retailer’s website directly, access it through a link from a cashback site to get some money back on your purchase. Alternatively, if you use credit cards, use one that gives you cashback or some other rewards when you pay with it.

Make Saving A Habit

Human beings are creatures of habit. If you do something enough, it becomes a natural part of your routine or way of life. If you want to start saving more money, the key is to think in terms of regular micro-habits that you can develop and implement over time. 

When you add some of the micro-habits we discussed here into your daily, weekly, or monthly routine, you might be surprised not only by how much you can save but also by how easy and effortless saving becomes in general.

Finally, remember that making progress is just as important as achieving that final goal. So don’t forget to celebrate the small wins, even if it’s saving an extra $50 each month as a result of a new micro habit in your regular routine such as finding and using coupons when shopping for groceries.