With the increased use of payment technology, you may be spending more than you realize. By keeping track of what you are spending your money on – everything from your morning cup of joe to your carwashes – you will get an idea of your spending habits. Once you have collected your financial data, you can organize the expenses into various categories such as groceries, household, entertainment/sports and bills.

Tip: Look for a free spending tracker or phone app to assist you in the process of tracking your expenses.

After determining what you are spending your money, you can create a personal and/or household budget to assist you in managing your expenses. Your budget should take into account your earnings and financial responsibilities and your expenses should not exceed your income. Your budget should include a savings category for unplanned expenses or the creation of a nest egg.

Tip: Most Canadians save between 10-15% of their annual salaries however, start by saving what you feel comfortable with.

If your expenses are so high that you can’t find ways to build a savings, you may consider cutting back on some of your spending. Analyze your spending trends to determine non-essential items that you can either cut out or spend less money on like gifts or dining out. You can also look for ways to save on fixed monthly expenses such as switching cell phone or internet providers.

Here are some ideas for monthly cost-savings:

• Cancel subscriptions or memberships that you no longer use.
• Do your research before purchasing items for the best deals. Once you have decided to go ahead with the purchase, wait a couple days before buying to prevent impulse buying.
• Pack your meals whenever possible.
• Price match at the grocery store.

Tip:  Unsubscribe from emails. Email marketing campaigns that send through discount codes or coupons can be an unnecessary spending temptation.

It can be easier to save when you have a goal in mind.  Start by thinking about what you may want to save for-a vacation, a new car or house-and then figure out how much you may need and how long it will take you to save for that item and/or event.

Here are some examples of short and long-term goals:

Short-term (1–3 years)

• Emergency fund (3–9 months of living expenses, just in case)
• Vacation
• Down payment for a car  

Long-term (4+ years)

• Down payment on a home or a remodelling project
• Your child’s education
• Retirement 

Tip: Set micro savings goals as much as possible. In saving for and achieving these goals, you will feel a psychological boost of gratification and it can be fun rewarding and fun to purchase something after saving for it.  

After income and expenses, your goals will likely have the biggest impact on your savings. You can start by making a list of short and long-term savings goals and prioritize the items on each list. This way, you will know what expenses you will need to save for. While there may be times that an expense arises that you didn’t account for, you may be able to use some of your savings and adjust your priorities and accordingly.

Tip: Prioritize your goals in a way that works for you. Start small and don’t overwhelm yourself as you will be more likely to abort the process if the thought of prioritizing your savings feels too overwhelming.  

Motor City Community has several savings mechanisms that can assist you in your short and long-term goals:

Click here to view our savings accounts.

Tip: You may consider a combination of options depending on interest rates and accessibility to the funds.

You may choose to have a weekly or monthly automatic transfer from your primary chequing account to your savings account. Or, you may opt to have a payroll deduction deposited directly to your savings account.

Tip: Make saving your money as simple and easy as possible by utilizing Motor City Community’s various automatic options. 

Review your budget and check your savings account monthly. This will allow you to identify further savings opportunities or fix any problems that you may see in your current budget. At the beginning, your budget may be a work in progress, you may make adjusts but, eventually, you will develop a plan that suits your needs.