Personal finances can be stressful for a lot of people, but there are some simple tips for saving that will put your mind at ease. With that in mind, here are some suggestions you can work with to get started on your savings targets for the new year, whether they be big or small. 

1. Eliminate debt

First things first. Whether it be credit card debt, a personal loan, or something else, the best route to start saving more is by paying down any debts you are have. By getting rid of debt, you're doing away with interest payments on top of what you have borrowed, and once it's paid off, you'll have more disposable income to save and invest. 

2. Track your essential expenses

Everyone has essential expenses to be paid every week, month, or year. Typically, this is your rent or mortgage, insurance, utilities or phone bills, transportation costs, and grocery bills. Calculate how much you need to meet the necessities and work from there. A good money management hack is to aim for between 30% - 35% spent on rent and 15% dedicated to other essential expenses. If it's less, great!

So hopefully, you're left with roughly 50% of your income to spend. Most of us have a few indulgences, between social lives, hobbies, our favorite subscriptions, and so on, but hopefully, you have roughly 25% left for discretionary spending after that point. If you find yourself going on a spending spree every time pay-day arrives, it can be a good idea to track how much you are buying certain items. This could be as simple as setting yourself a limit for how much goes towards clothes in a month, for example. Maybe you'll even have a few extra bucks to invest in the companies you've been buying from regularly!

3. Pay yourself first

Once you've established how much is left after expenses, a great idea is to transfer some of your excess earnings directly into an investing account. Most brokerage apps allow for direct deposits each week or month, which means you send the money from your account immediately, and you'll have less temptation to splurge on something else. It will depend on the individual when deciding how much to invest, but remember your investments should reflect a long-term mindset. It's not about saving or investing every dime you earn, rather, it's about building solid habits that you can stick to over time. 

4. Avoid lifestyle creep

So you've set a plan that you'll be able to manage. The last point to touch on is lifestyle creep. This is particularly important for younger people as they find themselves moving into new roles as their career progresses and they start earning more. Lifestyle creep is when your total income increases, but so does your spending; you might start to flash the cash a bit more now that you have more disposable income. There's nothing wrong with that, but if you do find yourself in a situation where you increase your earning power, be conscious of putting a little more away towards saving and investing for your future. 

Conclusion

So there we have it! If it helps, it can be a good idea to set up tabs for yourself between your bank account and savings account, and for some people, writing all of your expenses down and setting a goal can be of great benefit too.

If you're already up-to-date on your savings goals, check out this article on how to get started investing.