Tag: How To

 

How to Read Your Paycheck: A Guide to Deductions, Withholdings & Gross Pay vs. Net Pay

If there’s one thing we can all agree on, it’s this: Everyone loves pay day. 

Yet, even if that initial boost to your bank account feels awesome (you can even get paid up to two days early if you’re a Chime member), have you ever taken a look at what you’re actually paid vs. what’s taken out of your paycheck in deductions? Have you considered how these payroll deductions affect your money situation? 

Read on to learn how to read your paycheck. 

Gross Pay vs. Net Pay  

Let’s dive into some terms you might see. For starters, what is gross pay and net pay? 

Your gross pay is what you get paid before all of the deductions are taken out. You can consider your annual salary your gross pay. So, if you were offered a job with a $65,000 salary, that’s your gross pay. 

But that’s not what you take home at the end of the day. After all, there are taxes and other deductions that take a bite out of your paycheck. And here is where we arrive at your net pay.

Net pay refers to the amount you get paid after all the deductions are taken out. So, net pay is the actual number that gets deposited into your bank account

It’s important to know the difference between gross and net pay as this can affect how you spend and save money. For example, you might be spending based on your gross pay but it’s probably a better idea to base your budget and spending on your net pay, which is what you’re actually taking home. 

Tax Withholdings: How Gross Pay Becomes Net Pay

Do you remember when you first got hired and had to fill out a W-4 form and choose your tax withholding? 

It may be confusing, but what goes on that W-4 form determines how much gets taken out of your paycheck for taxes

Some typical deductions on your paycheck include:

  • Federal tax
  • State and local tax
  • Social Security and Medicare tax 

Let’s take a deeper look. 

  • Federal Income Tax  

If you’re an employee in the United States, you’re required to pay federal income tax. Federal income tax is a pay-as-you-go arrangement, so a portion is taken out with each paycheck. The amount deducted depends on your tax bracket as well the tax withholding you elected on your tax form. 

There are seven different federal income tax rates:

Tax Brackets and Rates 2019 by Tax Foundation
       Source: Tax Foundation

As you can see, how much you earn and whether you’re single or married will affect the amount of taxes deducted.

  • State Income Tax

It’s not just the federal government that wants a slice of your paycheck. Your state also has a state income tax that is taken out of your paycheck. 

Some states have a flat tax rate that doesn’t change regardless of your income. Other states, like Washington and Texas, have no state income tax at all. Still, other states have a graduated tax rate which is similar to the federal tax bracket breakdown. 

  • Federal Insurance Contributions Act (FICA): Social Security Tax & Medicare Tax

When you look at your paycheck you might see FICA and wonder what that acronym is. 

FICA stands for Federal Insurance Contributions Act, which includes social security tax and medicare tax. Employers are required by law to take out these deductions. 

The Social Security tax is something that you pay into and can use upon retirement. It’s also available if you become disabled. The Social Security tax rate is 12.4 percent and your employer pays half and you pay half, so your contribution is 6.2 percent. 

Medicare provides healthcare after age 65 or if you have a disability. The Medicare Tax rate is 2.9 percent and you and your employer each pay half, so your contribution is 1.45 percent. 

Employee Benefits Deductions 

We’ve covered the mandatory deductions that are taken out of your paycheck, but there may be other deductions that you opt into as well. For example, if you take advantage of your employer-sponsored retirement plan, you may see your 401(k) contributions deducted as well. 

Here are some common employee deductions. 

  • Health Insurance

Your employer may offer health insurance and you may have some of these deductions taken out of your paycheck to pay for your health coverage. For example, you might have separate line items for medical, vision and dental.  

  • 401(K) Retirement Savings 

In a nutshell, a 401(k) is an employer-sponsored retirement plan that is only available through your workplace. This can make it easier for you to save for retirement. Your 401(k) contributions are also tax deductible, which can lower your tax liability and save you money on taxes. 

  • Flex Spending & Health Savings Accounts 

At your job, you might be eligible for flex spending and health savings accounts. 

  1. A Flexible Spending Account (FSA) allows you to make tax-free contributions for out-of-pocket health costs. Your employer may contribute to the FSA but it is not obligated to do so. You typically must use your FSA funds within that same year. 
  2. A Health Savings Account (HSA), on the other hand, lets you save money on a pre-tax basis to pay for certain medical expenses like deductibles, co-payments, and more. The one caveat here is that you must have a High Deductible Health Plan (HDHP) to be eligible for an HSA. 

This is How Chime Gets You Paid Early

Why it’s Important to Understand Your Income Taxes & Employee Benefit Deductions 

Let’s face it: When payday comes, you’re probably excited for the cash. But it’s important to understand your income taxes and deductions. 

Having an understanding of how your paycheck works also makes you more financially literate and empowered. This will help you track your income more accurately, which will help you budget and save. Also, if something looks awry on your paycheck – because mistakes can happen – you can fix it. This way nothing will come between you and your money. 

Hourly Employees & Overtime Hours 

If you’re an hourly employee, it’s important to track your hours and make sure you’re getting paid for all the time you’ve worked. If you are eligible for overtime, make sure you know the policy and track those hours, too. 

Pay Stub Glossary: 13 Common Terms to Understand When Reading Your Paycheck 

There are several common terms that you might see on your pay stub. Below are some of these terms, along with their definitions. Take a look:  

1. Pay Period 

A pay period refers to the amount of time between one payroll run and the next. So, if you have a pay period from the 1st to the 15th of the month, you should be paid for all hours worked during that time. 

2. Withholding 

Withholding or withholding tax refers to money that is withheld from your check to be paid to the government. 

3. Deduction 

A deduction is an amount of money that is subtracted from your gross income, which can lower your tax liability. In other words, a deduction can lower the amount you pay in taxes. 

4. Bi-monthly paychecks 

Bi-monthly paychecks refer to getting paid twice a month, typically on the 15th and the last day of the month. 

5. Bi-weekly paychecks 

Bi-weekly paychecks refer to getting paid every other week.

6. Hourly Pay

Hourly pay refers to the amount of money you are paid for each hour worked. 

7. Salaried Pay 

Salaried pay refers to the total amount of money you’ll make for your work. If you have salaried pay, you typically get paid the same amount regardless of how much you work. 

8. YTD

YTD refers to Year to Date, which shows you how much you’ve earned at the start of the calendar year until the current date. 

9. Progressive Tax Rate 

A progressive tax rate refers to tax rates that go up gradually based on income. So, low income earners pay a lower tax rate compared to those who earn higher incomes. 

10. FT

FT refers to Federal Tax, or the taxes that the federal government take out of your paycheck. 

11. ST

ST refers to state tax, which refers to the taxes that your state takes out of your paycheck. State tax rates vary by state and not all states have state income tax. 

12. SS

SS refers to Social Security, which is a tax that goes toward retirement benefits for your future. 

13. MTW

MTW refers to Medicare Tax Withholding and is a tax that is taken out to provide insurance in your elderly years. 

Be your own financial advocate 

Now that you know the terminology and how to read your paycheck, you can take steps to manage your money and be your own financial advocate. Isn’t it about time you make sure you’re getting paid the right amount? 

 

Here’s How to Build $5,000 in Net Worth — While in Debt

Did you know that you can grow your money even if you don’t have a robust savings account? And, you don’t have to wait until all your debt is paid off before you start stacking the dollar bills in your bank account

In fact, you can rack up $5,000 in savings within six months — all while carrying debt. To get started, check out these pointers from Aristotle Hren-Boulis, a 25-year-old financial coach in Los Angeles.  

Figure out how much money you have to save and spend 

As Hren-Boulis says, “what gets tracked gets done.”  

Yet, instead of tracking every single transaction, which is as tedious as counting calories, focus on just your variable expenses. To start, figure out what your monthly income is. 

Next, pull out your fixed living expenses. These are those bills and expenses that you pay every month in about the same amounts. This typically includes rent, the minimum payments on your debt, utilities, and insurance. 

Pro tip: If you have a bill that you only pay a few times a year, like your auto insurance premium, you can divide that by the number of months and fold that into your monthly expenses.

Once that’s all done, you’re left with a number. Let’s say it’s $2,000. Divide that figure by the number of weeks in a month, which — if you want to be exact — is 4.28. If you have $2,000 beans after your fixed expenses, that’s about $467 a week. That’s how much you have to “play with,” and either put into your savings or spend on your other living expenses. If you have $1,500 after you subtract your fixed living expenses, that number is about $350 a week. 

Pay yourself first

After you pinpoint that number, divvy it up into savings and spending. How much should you save? Well, there’s no set number, as it depends on your lifestyle and preferences, says Hren-Boulis. 

“Everyone’s budget is different, so you’ll have to customize it,” he says.

So, if your weekly number is $467 after your fixed expenses are accounted for, try saving $200. The rest you can spend on your variable expenses, such as groceries, eating out, concert tickets, personal items, and clothes. Here’s the sweet part: If you save $200 a week, after six months you’ll have $5,000 in the bank!

Pro tip: To save time and brain space, automate your savings. If you’re a Chime member, you can choose to save a percentage of each paycheck with Chime’s Save as You Get Paid feature.

Budget weekly

Instead of budgeting for the entire month, break down your variable spending in weeklong chunks. 

When you’re starting out, Hren-Boulis recommends giving yourself more than you think you’ll need. To gauge this, you can go through your transaction history on a mobile banking app. Not sure where to start? Try $250 or $300 a week, and adjust your weekly savings accordingly. 

Start your budget on the weekend

Rather than beginning your budget on a Monday, Hren-Boulis recommends kick-starting your spending plan on the weekend. 

This way you’ll be in the flush and can enjoy yourself over the weekend. 

“Nobody wants to get to the weekend and run out of money. So if you start on the weekend, and spent $100, then you’ll have $150 Monday to Friday,” says Hren-Boluis. 

Of course, you’ll have to figure out what works best for you. For example, if you’re concerned with having enough money for groceries, you might start your budget on your weekly grocery shopping day. 

The important thing is to have enough money to spend so you don’t feel deprived or stressed out. 

Track your spending

You’ll only need to track your spending on your variable expenses. You can do this by way of jotting down notes on your phone or on a pad of paper, creating a simple spreadsheet, or using a money-saving app. 

“When you start tracking how much you’re spending each week, you start to mentally make trade-offs,” says Hren-Boulis. 

For instance, let’s say you have $30 left this week. You can think to yourself, “If I eat in tonight, I’ll have money to go out tomorrow night.”  

Spend what remains 

So what happens if you end up spending less in a week than the amount you had set aside? Hren-Boulis says it’s important to feel motivated and good about your money. 

For instance, if you end up having $100 left for that week, you could spend $60 on a massage and put the rest toward savings. And if you don’t feel deprived, then by all means save whatever is left over each week. 

He also doesn’t think it’s a good idea to “roll over” money into the next week.

“That’s when you start to get ideas,” says Hren-Boulis. 

Letting “extra” money spill over into subsequent weeks operates on the same principle of rollover minutes for cell carrier plans. If there are weeks where you have larger chunks of money to spend, you might get used to spending more than you can really afford. 

Track your net worth

Net worth isn’t your income, but rather your assets minus your liabilities. And, tracking your net worth is something you should get into the habit of, explains Hren-Boulis. 

Your assets include the value of your car, and how much you have sitting in your savings and retirement accounts. Your liabilities include all your debt — such as credit card balances, student loans, car loans, and personal loans. 

Try to check in on your net worth at least once a month. When you see that number growing, it’ll keep you motivated! 

Save those beans before paying off debt 

So, should the money you’re saving go toward debt or your emergency fund? 

Ideally, you should have some savings tucked away in an emergency fund before aggressively paying off your debt. Why? Well, if you don’t have much of a financial cushion, and the unexpected should occur, you might resort to using your credit cards, which could tailspin you into deeper debt. 

You do you

Following these tips is just one way you can go about saving $5,000 within six months. But, no matter how you slice and dice things, the important thing is to consistently save the same amount each week. Are you ready to give it a try?

 

How to Ruin Your Credit in Your 20s

We all make some foolish decisions in our 20s — it’s pretty much a rite of passage. But while most of these choices will be forgotten a few days or weeks, the financial ones have a habit of sticking around.

In fact, when it comes to your credit, you can easily make mistakes that will haunt you for years, even decades. And, damaging your credit has some very real consequences: Low scores could make it harder to get an apartment, car loan, or mortgage. (Not sure if you’ve got a credit file yet? Checking your credit reports and FICO scores — which are the most widely-used type of credit score — is almost as easy as opening a free bank account.)

Right now, you’re in a powerful position: You can either build your credit slowly and responsibly, or you can ruin your credit for years to come. Here are the seven worst credit mistakes you can make in your 20s. Once you know what they are, you can hopefully steer clear!

1. Charge More Than You Can Afford

The first and most common step in ruining your credit is living above your means.

That’s what Clarrisa Lee, who blogs at Later-Means-Never, did in her 20s.

“I didn’t have a lot of money growing up,” she says.

“So when I got access to credit, it felt like I’d won the lottery and I could buy everything that my heart desired — which I did, and which has cost me for decades.”

Now in her 40s, Lee is still paying off the debt she incurred more than 20 years ago.

What to do instead: Use your credit card as a tool to build credit, and never as a loan. Only buy what you can afford to comfortably pay off each month. When you pay your statement balance in full, you’ll never owe interest — but when you only make the minimum payments, you can drown in debt.

Here’s an example of what can happen if you only make the minimum payments:

  • Say you charge $5,000 to your credit card at a 19% interest rate.
  • You can’t afford to pay off the $5,000 bill, so you only make the minimum payment of $200 per month.
  • It will take you almost 12 years to pay off your balance — and cost you more than $3,000 in interest.

2. Carry a Balance on Your Card

When Mike Pearson, founder of Credit Takeoff, was in his 20s, he believed a common credit myth: carrying a balance on his card would improve his scores.

“For the first several months of having my first credit card, I kept a small balance rolled over from month to month, because I stupidly thought it would boost my credit scores,” he says.

“This caused me to pay several hundred dollars in interest.”

What to do instead: Pay your statement balance in full each month. Carrying a balance doesn’t help your credit; it only leads to interest charges and a higher credit utilization ratio (which we’ll explain below).

3. Max Out Your Available Credit

Maxing out your cards is another surefire way to harm your credit. That’s because doing so increases your “credit utilization ratio” — or the percentage of available credit you’re using — a number that comprises 30% of your FICO scores.

“I thought I could get by just paying off the minimum, until one day I realized I was using over 75% of my credit line,” recalls Russ Nauta, owner of CreditCardReviews.com.

“My credit scores took a deep dive.”

Here’s how this can happen:

  • Card A has a $1,500 credit limit and balance of $1,250.
  • Card B has a $500 credit limit and balance of $250.
  • In total, you have $2,000 of available credit.
  • You’re using $1,500 of it (or 75%), which might make lenders think you’re struggling to pay your bills.

What to do instead: Only spend a small percentage of your available credit, and strive to pay your statement in full each month. While some experts recommend a maximum of 20% credit utilization, the truth is: the lower, the better.

4. Miss Credit Card Payments

So, you bought drinks for the whole bar, or splurged on some designer sneaks — and then realized you couldn’t afford to pay your bill. The biggest mistake you can make? Deleting your statements without looking at them, neglecting to even pay the minimums.

Since payment history is the single most important FICO factor, accounting for 35% of your scores, that’s like taking the fast lane to terrible credit.

Even if you know how detrimental missing payments is, you can still slip up. Just look at what happened to Self Lender CEO James Garvey when he went on his honeymoon in Argentina.

“One of my credit cards was not set up on autopay and the bill went unpaid for two months,” he says.

“As a result of my dumb mistake, my credit scores were damaged for years.”

What to do instead: Set up autopay for all your bills, then set a reminder to go over your finances once a week. Log into all of your accounts and mobile banking apps to A) check your charges and B) make sure your payments have successfully gone through.

While we strongly encourage you to pay your statement in full, you should always make at least the minimum payment to avoid late fees and credit damage.

5. Close Your Credit Cards

You’ve finally paid off a credit card, and you’re so excited to be debt-free that you immediately close your account. In doing so, you lower your “average age of accounts,” which makes up 15% of FICO scores. Womp womp.

“The biggest credit mistake we made in our early 20s was closing down credit cards we no longer used,” says Brittany Kline, co-owner of The Savvy Couple.

“Looking back we should have kept them open to grow our credit history.”

What to do instead: Although you’re welcome to cut up your credit card so you can’t use it anymore, don’t close the account — especially if it’s your first or only card. Keeping it open will maintain your average age of accounts, and if the card has a $0 balance, will also help lower your credit utilization ratio.

6. Ignore Your Student Loans

Even if you took out student loans when you were just 18 years old — barely an adult! — they still factor into your credit scores. And a quick way to harm your credit is to neglect the bills (as overwhelming as they may be).

Marketer Destinee Wright took out thousands of dollars in student loans to pay for college. After graduating, she let one of them fall into default — a move that ruined her credit for years to come.

“I’m still digging myself out of that hole,” she says.

What to do instead: If your payments are unaffordable, ask your servicer about income-driven repayment plans, which extend your repayment period and cap your payments at a certain percentage of your income. Although you’ll pay more interest, that’s infinitely better than defaulting on your loans and damaging your credit.

If you’re experiencing temporary financial hardship, you can also consider applying for deferment or forbearance, which will pause your student loan payments (but not your interest accrual for unsubsidized loans) for a certain amount of time.

7. Avoid Credit Entirely

The last way to ruin your credit might surprise you: It’s to never use credit at all. If you eschew credit cards or other loans entirely, you won’t establish a credit history, and lenders won’t know whether you’re a responsible borrower.

That will make it extremely difficult for you to get financing for purchases like a home or car.

What to do instead: If you want to build your credit over time, apply for a starter credit card that helps you build credit, and then do everything you can to pay your bills on time and in full. Alternatively, if you’ve already damaged your scores, consider getting a “secured” card specifically targeted at helping people rebuild their credit.

How to Not Ruin Your Credit: Proceed With Caution

Now that you know seven guaranteed ways to ruin your credit, we hope you’ll follow the alternative advice, and slowly build your credit up from the bottom up.

Remember: The important thing isn’t to avoid credit; it’s to use it responsibly. Take it from us thirtysomethings — and don’t repeat our mistakes!

 

How to Buy Car Insurance

We hear ya: The #adulting lifestyle is giving you a run for your money.

And, we’re about to throw something else at you: You may need to learn how to buy car insurance. Yup, even if you’d rather spend your hard-earned money elsewhere or save up for a vacay, car insurance is crucial if you plan to drive.

We’re here to tell you that finding an insurance policy that fits your budget is possible. Here’s everything you need to know about how to buy car insurance.

Understand the Basics

The point of car insurance is to protect you financially if you get into an accident or your car gets stolen.

Here’s a quick breakdown of car insurance lingo:

1. Liability Coverage

Liability coverage pays for the damage you cause in an accident. It covers both bodily injuries and property damage. Most insurance companies structure this coverage into three parts.

For example, you can choose 100/300/50 coverage limits, which means your insurance company will pay up to:

  • $100,000 for injuries per person.
  • $300,000 for injuries in total, per accident.
  • $50,000 for property damage per accident.

2. Uninsured/Underinsured Motorist Coverage

Nearly one in eight drivers on the road are uninsured. Why should you care? Because this can put you at risk.

Uninsured/underinsured motorist coverage pays for the costs of your property damage and bodily injuries caused by an uninsured or underinsured motorist. This is also the area of coverage that will protect you in the case of a hit-and-run accident.

3. Comprehensive Coverage

What if you need to repair or replace your vehicle but weren’t in a collision?

This is where comprehensive insurance coverage steps in. This coverage protects you against vandalism, theft, fires, accidents with animals and natural disasters. Oftentimes,  drivers will set their deductible to $1,000 to keep the annual cost of this coverage low. This means that if you claim fire damage, you will be responsible to pay your $1,000 deductible before your insurance benefits kick in.

4. Collision Coverage

Collision coverage helps you pay to repair or replace a vehicle that has been damaged in an accident. With this coverage, your insurance company will cut you a check if you totaled your car in an at-fault accident.

It is optional coverage if you own your car outright, but it is worth having. If you are leasing or financing your current set of wheels, this coverage might be required.

5. Medical Payments Coverage

Medical payments insurance is the additional coverage used to pay for excess medical costs that do not fall under liability coverage. It will pay for accident-related dental work, EMT and ambulance fees, surgeries, funerals and more. You can also use this coverage if you’re injured by a vehicle as a pedestrian or bicyclist.

Drivers can set the maximum limit of coverage for medical payments. The higher the amount of coverage, the higher your premium.

6. Personal Injury Protection

Personal Injury Protection covers medical expenses for the drivers and their passengers. The coverage extends to individuals that do not have health insurance, as well. Not all states require PIP coverage. If it’s optional in your state, figure out how much extra it will cost you per payment. You can then decide if it’s more beneficial to use your money to start a savings account or pad your emergency fund.

Ways to Buy Car Insurance

Now that you’re familiar with the different types of insurance coverage, it’s time to buy a car insurance policy.

Shopping for car insurance has never been easier. There are several resources at your disposal to help you choose the right policy, including many online aggregators to help you compare prices. So, take the time to research different policies and shop quotes. Even a $25 monthly price difference can add up to a potential $275 saved per year.

Here’s how to shop for car insurance:

  • Buy From an Auto Insurance Agent

An auto insurance agent works for a specific company and can give you in-depth details on that company’s rates and policies. Many times bundling your car insurance with your homeowners or rental policy can save you money, but don’t forget to compare prices.

Agents can be helpful as you can get personal answers to tricky questions like, do I need insurance to buy a car? Or, what types of vehicles cost less to insure? Ultimately, an agent’s job is to sell you a policy, so again, make sure you shop around so you can save money.

  • Use a Broker

Unlike an agent, an independent auto insurance broker is not tied to a specific company. A broker works for you and can help you discover the best types of coverage for your driving needs. They can also provide you with a wide variety of policies and quotes from different companies. Make sure to ask if the broker charges a fee for his services or if he works on commission.

  • Shop for Car Insurance Quotes Online or by Phone

You can also skip the agent and broker altogether. Several companies make it easy to get vehicle insurance quotes with a quick online or phone questionnaire. Typically, these questionnaires are fast and you will get your estimated quote within minutes. The final quote typically comes after your driving record and credit information are received by the company.

  • Use a Comparison Tool to Compare Car Insurance Rates

Comparison tools on websites can help you see several different rates and policy details side-by-side.

Keep in mind that these websites can receive a financial kickback for featuring specific companies. So, use these tools as a jumping off point to do more research. NerdWallet’s free car insurance quote comparison and Compare’s auto insurance tool are worth checking out.

Four Tips to Save Money on Car Insurance

Credit Karma estimates that Americans overspend on auto insurance by nearly $21 billion per year. Here are four ways to score cheap car insurance:

1. Shop Around for Auto Insurance Quotes

Figuring out how to insure a car is going to take an hour or two. Yet, factoring in the time can save you up to $365 from your annual bill. So, it’s time well-spent.

To start, use an online comparison tool to see the top three auto insurance companies in your area. Next, talk with an insurance broker to better understand your options. Finally, chat with individual agents to discover possible discounts.

2. Don’t be Afraid to Switch Car Insurance Policies

You aren’t married to your car insurance policy. You can look at new rates and even switch insurance companies at any time. So, shop for new quotes every six months as rates change often.

3. Raise Your Deductible

A higher deductible can decrease your overall monthly rate. In fact, you can save an average of $367 per year by increasing a $250 deductible to $1,000.

To minimize the risk of a higher deductible, make sure you have an established emergency fund. If setting $1,000 into a savings account seems daunting, use automatic savings with Chime.

4. Don’t be Afraid to Ask About Driver Discounts

Ask insurance agents if they offer any discounts. You might be surprised to find out that drivers under 25 can save 15 to 25 percent if they have a 3.0 GPA or higher. Likewise, drivers can earn a discount for being low income, driving a hybrid vehicle or being in the military. Many companies also offer discounts if you pay your premium in one lump sum.

5. Raise Your Credit Score

Many insurance companies will look at your credit score as one of the many factors to determine your premium. The reason behind this is that drivers with poor credit-based insurance scores are more likely to file a claim. A higher credit score, along with a clean driving record and safe vehicle type, will give you a better credit-based insurance score.

(If you live in California, Massachusetts or Hawaii, this doesn’t apply to you. These states don’t allow car insurance companies to base rates off of scores.)

Shop Smart and Save Money

Figuring out how to buy auto insurance is not as complicated as it seems.

Remember, once you commit to a great rate, don’t be afraid to play the field every six months. You never know when you’ll find a lower auto insurance rate and save money.

 

How to Learn to Be Rich: Tips from Ramit Sethi

We hear the same rules of personal finance again and again. Save up three to six months of expenses into an emergency fund. Pay off “bad” or “high-interest debt” first. Make more money.

It’s one thing to know what your finances should look like. It’s another thing to know what steps to take to achieve your money goals.

For this knowledge, we looked to personal finance guru Ramit Sethi for golden nuggets of wisdom. When Sethi wrote his New York Times bestseller I Will Teach You to Be Rich in 2009, it was during the height of the Great Recession. The general population sorely needed a fresh look on money. Here’s some happy news: A fresh, updated edition of this book was recently released. Sethi provides an easy-to-read, relatable primer on basic money management. He also offers insight on how to grow your wealth.

We delved into the updated version to offer up five of Sethi’s top tips. Take a look.

1. Avoid bank fees like the plague

Your bank shouldn’t be putting you in the poorhouse. Instead, your bank should help you save money. But according to FDIC data, big banks collected $11.45 billion in overdraft and non-sufficient fees in 2017. The truth hurts: Most banks charge $35 per overdraft fee.

Sethi says he is “fanatical” about having a bank account that doesn’t charge fees of any kind — no monthly maintenance fees, setup fees, or overdraft fees. And I’m 100 percent with him. Like Sethi, I also avoid banks with fees. If you’re a Chime member, you too can rest assured that you won’t be charged fees of any sort.

2. Automate your money flow

Sethi talks about how important it is to set up what he calls an Automatic Money Flow. This is when you link up all your accounts, and then set up automatic transfers on certain days. You can schedule transfers for both payments and savings. And, ideally you should try to sync up your bills with the days you get paid.

For freelancers and gig economy workers, Sethi recommends saving during your flush months, and spending from your savings when you’re having a lean month.

You can think of it as water running through different systems in your “money house” to keep everything running smoothly. What’s more, this system will help you save a reserve of money and have some cash set aside for your goals. Yes, it requires some thought and setup work, but after that, all you have to do is monitor your accounts every so often, and make tweaks as needed.

3. Set up auto-savings

Throughout the book, Sethi talks about different ways you can automate your savings. For instance, you can set up an auto transfer directly from your paycheck into a 401(k) account. Or automate your investments. And of course, you’ll want to automate your savings for big money goals. If you’re a Chime member, the Save When I Get Paid feature allows you to save a percentage of every paycheck.

4. Know your why

Another takeway from Sethi’s book is not to live in a spreadsheet. In other words, don’t get too caught up in the numbers as it’s important to remember why you’re managing your money in the first place. He calls it “street-level motivation.” For example, how can your money management skills help you live a richer, more fulfilled life based on your own vision? Do you want to afford a massage every so often, or maybe take a ride share instead of the bus? Make a note of your “why.”

5. Start small

Taking small steps toward reaching your financial goals will pave the way toward major in-roads. As Sethi points out, it’s far more important to take small steps today than wade through an exhaustive litany of literature out of fear of making the wrong choice. I get it. In this day and age, we’re faced with more options than ever — from which bank is best for you to which money-saving app to use.

Keep it simple

Sethi’s book outlines ways to set up a money system designed to help you live a richer life defined by your values, preferences and goals. At the end of the day, once you set yourself up, you’ll spend as little time and energy thinking about your money as possible.

 

How to Fight Summer FOMO and Fatten Up Your Savings Account

Summertime brings warm weather — and a major temptation to spend money. From hitting the concert circuit to shopping for new clothes to taking a dream group vacation, the opportunities to spend money are endless.

Blowing through your cash may be fun but it can also put a major dent in your bank account.

The good news is: You don’t have to shut down your social calendar when the lazy days of summer set in. By following these five tips, you can keep the summer FOMO at bay – and potentially boost your savings by fall.

1. Unplug from social media

Imposing a ban on checking your social feeds can be one of your best defenses against FOMO spending.

“It’s very easy to feel like you’re missing out when scrolling through countless summer posts showing your friends enjoying themselves,” says Matt Edstrom, CMO of GoodLife Home Loans.

He says the pressure to spend only gets worse if you’re receiving invites to go out via social. The solution? Take a time out from Insta, Facebook and all the rest. If you can’t do that, be ready to make a frugal counter-offer if a friend suggests some pricey fun.

“If someone is posting about wanting to go to a particularly swanky place for happy hour, you could propose an alternate location that’s still trendy but also affordable,” says Edstrom.

Or even better, suggest a BYOB get-together at home. You could even make it a regular thing, with a different member of your circle playing host each week.

And, let your friends know from the start that you’re trying to curb your spending for summer and step up your savings. That way, if you have to say no to an outing, they’ll understand why.

2. Set up a “just for summer” savings fund

The next best thing you can do to avoid summer FOMO is to be prepared for it. That means having a special savings account just for summer fun, says Rebecca Gramuglia, personal finance expert at cash back site TopCashback.com.

“Summertime means longer days and more time for activities and sometimes those summer adventures come with a price-tag, which is why starting a summer fund is so important,” Gramuglia says.

The simplest way to create a summer fund? Set up a direct deposit from your paycheck into a separate savings account each payday. Pick a target amount you want to budget for your summer spending each month, then break that down by the number of paychecks you receive monthly. Commit to having that amount sent straight to savings, then transfer it to your checking to use as activities with friends come up.

Gramuglia says that ideally, if you start building this fund a few months before summer kicks off, you’ll have a cushion ready to go. But if you’re getting a late start, take advantage of small windfalls to build it up.

“Any time you have leftover change, bonuses or (get) cash back, add it into your summer fund,” she says.

3. Don’t spend without looking for deals and discounts first

With so many coupon apps, deal sites and money-saving apps to choose from, there’s no reason to pay full price for summer spending, whether it involves travel, dining, shopping or entertainment.

If you’re planning a trip with friends, for example, try doing it backwards, says Meghan Fox, a money-saving expert at gift card marketplace Raise.

“Find the best deals on sites like Kayak, Travelocity and Expedia, then pick a destination where you’ll get more bang for your buck.”

Sites like Skyscanner and Hopper are also good for comparing prices on airfare. Purchasing discounted gift cards is another option for saving on flights, hotels and other purchases. At Raise, for instance, you can find discounted gift cards from Hotels.com, Airbnb and Southwest Airlines.

For summer spending other than travel, visit deal and coupon sites like Groupon, LivingSocial or RetailMeNot to see what’s on tap for promo codes and coupons. You can find discounts on spa packages, restaurants, and movie tickets.

4. Plan some solo activities

If you’re worried that hanging out with friends over the summer will push your budget to the limit, schedule in some alone time. Then, fill that time with things that don’t cost a dime.

That’s something Julia Askin, a marketing coordinator with mobile app development firm Fueled does. After moving to New York City six months ago, she’s feeling the pressure on her budget to “do it all”.

“To combat FOMO and protect my budget, I commit much less to social engagements and focus instead on growing my areas of interest and passion,” Askin says.

In the summer months, this includes spending time outdoors and taking free online classes to learn new skills, both of which leave her bank account intact.

If you’re looking for free or low-cost things to do, check your local recreation center. Or, head to your library or a museum for an afternoon. Volunteer your time for a good cause. Challenge yourself to come up with as many free ideas as you can. To make it really interesting, consider doing a no-spend week over the summer to see how much you can save.

5. Create money goals to keep you motivated

It’s tough not spending money, especially if you feel a little left out of the fun. Giving yourself some clear goals can help you maintain a positive mindset.

For example, your goals might include:

  • Paying an extra $2,000 off your student loans by the end of August
  • Saving $1,500 in a baby emergency fund in a month
  • Starting your savings cushion for a down payment on a first home
  • Finally getting around to opening up an IRA to save for retirement

Your goals can be big or small, but make sure they’re S.M.A.R.T. – specific, measurable, achievable, realistic and time-bound. Any time your friends are tempting you to spend, remind yourself of your goals. This could be all you need to dodge the FOMO bullet.

Summer FOMO doesn’t have to wreck your budget

The fear of missing out on fun with friends can only sabotage your spending if you let it. Planning ahead and setting some ground rules for spending over the summer can make it easier to avoid giving into temptation.

As a bonus, you may end up with a padded savings account!

 

How to Quit Your Food Delivery Addiction

Have a food delivery addiction? There’s no denying that restaurants offering a delivery service provide lots of convenience to busy people who don’t have the time or energy to cook.

If this sounds like you, you’re not alone. Millennials are three times as likely to use food delivery apps as their parents. That’s partially what’s fueling the online food delivery market, which is projected to grow from $17 billion to more than $24 billion by 2023.

To boot, new delivery app services like DoorDash, Postmates and Uber Eats have taken it to the next level. With these apps, you can quickly order meals from your phone to be delivered to you at work, home, or anywhere else.

Unfortunately, the food delivery habit adds up. And, spending regularly with food delivery apps can definitely negatively impact your savings account.

If you’re tired of eating up all your money (literally) with food delivery apps, here’s what you can do to quit your food delivery addiction.

Actually Visualize What Your Spending

One thing you can do to motivate yourself to quit is to actually look at what you’re spending. Track what you spent on food delivery apps over the past 90 days and add up the total. You may be shocked by the numbers you see.

For example, Uber Eats charges a flat rate fee which is usually under $5. However, sometimes they tack on a ‘busy fee’ during high volume times. Postmates, on the other hand, charges a $5.99 delivery fee (which is reduced to $3.99 for partner restaurants) for orders under $20. These noticeable fees add up each time you place an order.

Once you add up what you’re spending, you can actually see what your food delivery addiction is costing you. Then, think about your annual salary or hourly rate at work and compare it to your food delivery purchases. How many hours did you have to work just to be able to afford all that takeout? What else could you have done with the money instead?

Delete the Apps

It may be tough, but you might want to go cold turkey and delete all your apps at once.

You can still dine out occasionally to make the transition smoother. This way, you can indulge a little but you’ll be actually be leaving your house for the social experience of dining out. Better yet, you’ll skip out on the hefty delivery fees.

Plan Your Weekend Meals

Let’s face it, most people feel the urge to dine out and order food on weekends. Maybe you have a busy schedule or perhaps you just want to relax.

Instead, try meal planning in advance so you feel prepared and don’t resort to using delivery apps. Prepare a simple breakfast like oatmeal and fruit, or homemade avocado toast and eggs before you head out for the day.

If you’ll be out all day, consider packing a lunch to bring with you. You can also buy snacks in bulk at stores like Costco to help curb your appetite between meals.

Lastly, consider preparing a delicious batch meal (multiple servings) to enjoy for dinner over the next few nights so you won’t have to cook. It only takes an extra hour to meal plan for busy days during the week but the savings are worth it.

Pay Yourself First

Do you have other financial goals that you need to reach? I’m sure your main desire isn’t to spend a ton of money on food delivery each week, right?

To start, narrow down what you really want to do with your money and then, start paying yourself first to save up.

For example, if you’ve always wanted to take a tropical vacation, start saving money whenever you get paid. If your dream has always been to remodel your kitchen, pay yourself first and set aside money for this project each month.

These goals are fun, exciting, and motivate you to pay yourself first. I love this concept because it ensures that you will be able to afford your most important expenses. From there, you can budget with whatever is left. If you still want to dine out or order food occasionally, you can do so without feeling like you’re overspending and neglecting what’s important.

Prepare Freezer Meals for Emergencies

We all have those situations where it’s been a busy day and there’s no plan set for dinner. In the past, you may have resorted to ordering food on Grubhub or Postmates.

Instead, prepare some emergency meals in advance to stick in the freezer. The ‘freezer cooking’ trend is huge on Pinterest and you can find tons of recipes and meal ideas to prep.

Imagine the convenience of being able to pull a healthy meal out of the freezer to warm up for dinner. It will only take minutes and save you tons of money over time.

Don’t Fall For the Convenience Factor

Food delivery is an expensive addiction to have. To break this habit, you’ll have to be motivated and consider how much it is costing you.

So, think about purchases you’d have to push off or smart financial moves you couldn’t make due to your excessive take-out habits. With this in mind, you’re more apt to consider deleting your food delivery apps or at least cutting down and trying some of the alternatives mentioned above.

Are you ready to try ditching your food delivery habit? Give it a go. Your savings account will thank you (and possibly your waistline too!)

 

How to Save Money and Budget in Your 20s and 30s

When I moved out of my mom’s house when I was at 23, my greatest fear was having to move back home – again.

In turn, I did everything I could to stretch my $1,800 a month take-home pay. By being frugal, taking on side hustles, and saving as much as possible, I was able to both squeak by and save money each every month. It was no easy feat, but it was doable. Remember: You don’t have to live in a van to budget wisely and save moneyEven small steps can help, like switching to a bank that doesn’t charge unnecessary fees and negotiating for a lower Internet bill.

Fast forward to the present. Now that I’m in my 30s, I know that my budgeting, frugality and hard-core money-saving ways paid off. Still, there’s so much I wish I’d known about managing money 10 years ago.

To up your budgeting game and start saving money in your 20s and 30s, read on. Your future self will thank you. 

 4 smart money tips for your 20s

Let’s face it: Adulting is hard, especially when you’re just starting out. These 4 tactics for budgeting and saving money will help guide you through your 20s in style.

1. Salary is important, but don’t forget about job benefits

You might not be making as much money as you’d like right out of college. But salary isn’t the only measure you should consider when evaluating a job.

Take a look at the entire compensation and benefits package. This includes health insurance, disability, and life insurance benefits, plus employee perks (like free gym memberships), and whether your employer offers a 401(k) match. Also consider this: Will there be opportunities to learn new skills, work with a mentor, or move up the corporate ladder?

I consider learning on the job as an added benefit. For instance, when I worked in the communications department for an entertainment labor union, my boss subsidized courses I took in graphic design and copyediting. These skills ended up being crucial to my future job opportunities and earning potential.

While I was fortunate as a 20-something to have steady jobs with robust benefits, I worked in niche industries without much room for growth. Looking back, I wish I’d spent even more time focused on growing my paycheck and my career potential.

2. Save money the new-fashioned way: automation

In your 20s, it’s not surprising that you may be stressed out about your money situation. That’s why one of my favorite money-saving hacks is to automate your finances.

You can automate your savings for an emergency fund, for a car, or for investment in a retirement account. If you’re a Chime Member, consider opting into the Save When I Get Paid feature.

And yes, while you have decades before you retire, the earlier you begin to save for this goal, the better. Why is that? Two things: time in the market and the magic of compound interest. Let’s say you begin saving $250 a month starting at the age of 25. You keep it up for 40 years until you’re 65. According to Investor.gov, if you earn an average of seven percent interest, you’ll have earned just shy of $600,000.

While I opened an IRA in my early 20s, I put in $100 and then stopped. Imagine how much I would have if I had continued putting money into it! And for one of my jobs, I failed to opt into the matching 401(k) plan until a year after I started. That’s money I left on the table. 

The takeaway: If you automate your savings, you’re essentially budgeting without having to think about it. You’ll be glad you did.

3. Track, manage, and reduce your daily spending

It doesn’t matter how much you earn: You can always get into the habit of saving. To start, try cutting back. Limit yourself to one restaurant meal per week. Try a no-spend Sunday. Or use a money management app to track your spending to see what your vices are.

After having a few spend-happy months this year, I’m focusing on two major problem areas for a month: food and clothes. When it comes to food, instead of overstocking my fridge, I’ve started checking my pantry before I head to the market. This helps me plan out my meals, stick to a weekly food budget, and cook in batches. As for clothes, now I wait 30 days before purchasing something I have my eye on.

4. Start paying off student loans and other debts

Sure, you wish your debt could just disappear yesterday. And while it’s tempting to ignore your student loans, credit card statements, car loan, or healthcare bills, you’re going to have to pay them off eventually. No matter what type of debt you have, your first step is to determine exactly how much money you owe, to whom, and what the interest rates are.

Next, come up with a debt repayment plan to help you budget, how much you can reasonably afford to pay off each month. After that, commit to making regular, timely payments.  Not only will this keep you on track to paying off your debts with as little accumulated interest as possible, it’ll also help you get the highest credit score you can manage.

3 smart money tips for your 30s

Whether it feels like a graduation or a funeral, the transition into your 30s means reevaluating career goals, income, and outstanding debts. But don’t worry: A few simple practices will put you on the path to sustainable financial health.

1. Make more money

While in your 20s, you were laying the groundwork to save money and invest. In your 30s, however, you’ll want to start thinking about growing your money.

There’s no single way to approach this. It depends on your personal situation, existing resources, and lifestyle preferences. For example, perhaps you want to buy your first home, or get serious about investing in the stock market. This is your time to make decisions to grow your money.

Although you can only cut so much of your living expenses, you can increase your earning potential. For example, it wasn’t until I job-hopped that I started making more money.  Another major wealth-building move for me was when I turned my side hustle of freelance writing and copyediting into a full-time gig.

2. Pay off your student loans & credit cards for good 

“Good debt” is loosely defined as debt for valuable assets that can grow over time. Traditional examples of good debt include a mortgage on a home or a business loan. “Bad debt” is anything that loses value over time, or has a high-interest rate, which can eat into your savings. “Bad debt” is normally thought of as credit card debt, student loans, and personal loans.

However, there are a lot of gray areas. Credit card debt can be a good thing. If you have a balance, but pay it off in full each pay cycle, this can boost your credit.

Live the life you can actually afford

As my friend Kristin Wong, author of “Get Money” likes to say, there’s a difference between living the life you can afford, and living the life you want.

As you continue to build wealth and establish your career, you may view your thirties as a time when you can abandon the responsible habits you spent your 20s, but it’s important not to slip into old ways. Make sure you continue saving money and assessing your income and spending habits, that way you can continue onto the next decade with an even greater feeling of financial freedom.

The perks of financial wellness are many — freedom from money stress, the resources, and knowledge to grow your money, and the ability to live your best life.

 

 

How to Turn Your Side Hustle into a Full-time Gig

Fifty percent of millennials have a side gig, according to a study by Experian.

This is often the perfect way to jumpstart your financial goals, including debt freedom, moving into your own apartment, or funding that dream vacation. A side hustle can also be a big motivator to launching a full-time business and achieving financial freedom.

To help you learn more, take a look at seven tips to turn your side hustle into a full-time gig.

1. Be Realistic

The truth is: Not every side job can be turned into a full-time hustle. For example, mowing your neighbors’ lawns every weekend probably works really well as a side gig, generating a few hundred dollars a month. But you would need to put in a lot more effort to transform this concept into a full-fledged business. For example, you’d need to consider advertising costs, the seasonality of a lawncare business, and the existing competition in the market.

Putting together a financial forecast to determine your total revenues and expenses is another important part of your research at this stage.

2. Stop Treating Your Side Business Like a Hobby

Leah Gervais, founder of Urban 20 Something, says that if you want to scale your side hustle into a full-time gig, you need to treat your side business “like your job, because it is.”

“This means scheduling out your time to work on it and making those meetings unbreakable. Be honest with yourself; this will be an intense time period with long hours and lots of sacrifices. But it’s just a chapter. The more dedicated you are, the faster you’ll be able to make your side hustle your full-time hustle,” says Gervais.

Another way to up your commitment level is to formalize your business structure. Tasha Cochran, one half of the YouTube channel One Big Happy Life, recently quit her job to pursue her blogging hustle full-time. As she noted on her website: “We became an LLC, signed a partnership agreement and started to be more strategic about what we were doing.”

3. Look for Ways to Work Smarter

A side hustle can be hard to scale but it’s not impossible. One way to grow your side hustle is to transition from a one-to-one business model to a one-to-many business model. Translation: Figure out how to earn money while you sleep!

One booming market for doing this is the e-learning industry. According to Reuters, global e-learning grew to $165.21 billion in 2015 and is expected to skyrocket to $275.10 billion by 2022.

Just be aware: In order to scale an e-learning business with a host of online courses, you do have to hustle.

For example, Robyn Parets migrated online with her branded Pretzel Kids Yoga Teacher Certification Course in 2016. Pretzel Kids still offers live trainings and kids yoga classes, but the online school allows the company to grow its reach globally. Pretzel Kids nows sells a host of courses via its online kids yoga training school, such as How to Teach Mindfulness to Kids and Yoga for Kids with Special Needs. In addition, Pretzel Kids instructors can join a membership community where they can access branded materials, download teaching resources, get booked for teaching gigs, and more, says Parets.

“The ability to offer online trainings and a membership community has been pivotal to the growth of Pretzel Kids. We also offer our trained teachers a way to immediately start their own side hustles using our curriculum,” she says.

4. Invest in Yourself

Have you ever heard the saying the best investment you can make is in yourself? This is especially applicable to scaling your side hustle because you are your biggest asset.

As a full-time entrepreneur to-be, the learning process should be a continuous one. In the early days of scaling your hustle, you might have to invest in tools and courses to beef up your skill set. For example, you may need to learn more about email marketing or social media. Yet, in the long-run, this will save you time and money.

You can also fast-track your success by finding a mentor and connecting with other like-minded people who can help your business thrive.

5. Wait Until Your Side Hustle Earnings are Consistent

Before you make the leap from full-time employee to full-time entrepreneur, your side hustle earnings should either equal your current income or be sufficient enough to cover your living expenses.

Don’t forget to include a line item in your new budget for those intangible benefits that your current job provides, including health insurance, 401(k) contributions and the like. For example, if you have to say goodbye to free lunch on Fridays or free daily coffee, make sure to add these as new expenses each week.

Another tip is to wait at least a few months in order to determine whether your side business will produce consistent earnings. This is exactly what Gervais did. Once her side business started regularly bringing in more money than she made at her 9 to 5 job, she had the confidence to turn it into her full-time job. Today, her online business generates more than $10k in sales per month.

6. Boost Your Emergency Fund Before Taking the Plunge

If you have a healthy savings account, then you’ll have peace of mind to go all-in on your side business. To help you boost your emergency fund faster, you can try automating your finances.

With a Chime bank account, for example, you can save when you get paid and automatically direct a percentage of every paycheck into your Chime Savings Account. This way you can put your savings on autopilot and reach full-time entrepreneur status sooner. As a bonus, if you use your Chime Visa Debit Card to make purchases, Chime will round up each purchase you make to the nearest dollar, and transfer the round up amount right into your Savings Account.

7. Schedule in Self-Care

When you’re working to scale your side hustle into a full-time business, it’s easy to put health and wellness on the back-burner. But taking care of your physical and emotional well-being is more important than ever at this stage. The good news is: Self-care doesn’t have to be expensive. It can be as simple as scheduling in a 30-minute walk each day to get some fresh air and mental clarity, reading a book or enjoying a long bath.

Ready, Set, Go!

If transitioning your side hustle into a full-time gig is something that you’ve been on the fence about, we hope these seven tips will give you the push you need to start living your dream!

 

How to Ball on a Budget When You Go Out

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Let’s say you get a call from a close friend. She just got a promotion at work, and she’s inviting you to a trendy Thai restaurant to celebrate. You love Thai food and want to go, but there’s one problem: Your budget’s looking pretty tight this month.

Thankfully, you can still go out without compromising your savings. For example, you can decide how much you can spend and then adjust your budget accordingly.

“If you know that in the summer, you tend to go out more and spend more money, then make room for that in your budget and cut back in other areas to accommodate that,” says Jamila Souffrant, certified financial education instructor and founder of the blog and podcast Journey to Launch.

For instance, you can cut the cable cord and ditch your meal box subscription, leaving more wiggle room for nights out, concerts and movies. To help you get started, we’ve rounded up some tips for saving money on just about any outing. Take a look.

At a Sporting Event

If you’re dying to see the Chicago Bulls (or your own favorite team), you can make it happen without breaking the bank. Souffrant recommends buying your tickets in-person from the box office to avoid service fees from online ticketers.

You can also pick games that aren’t super expensive. For example, maybe go on a work night when it’s less crowded and you can more easily score cheaper tickets. Typically, games during the week are less costly than Friday, Saturday, or Sunday games.

On the day of the big game, be sure to eat before you leave home to avoid paying the markup at the snack counter. Your belly and your bank account will feel fuller.

At a Movie

Sometimes, it’s good to catch a summer blockbuster on the big screen and swoon over your favorite actors. Just be sure to steer clear of the overpriced movie theater concession stand.

“Definitely do not buy any of the snacks or drinks in the movie theater. I know it’s tempting, but eat before you go and/or bring your own snacks,” says Souffrant.

Souffrant also recommends looking for discounted tickets or deals on sites like Groupon or the theaters’ own website. You can also go to a weekend matinee and head out to dinner afterwards – instead of the other way around.

By planning in advance, you can enjoy buzzworthy movies and save money at the same time.

At a Concert

Hanging out with friends at concerts is part of summer fun. But to save money, it’s important that you try to buy tickets at the box office in advance, says Souffrant.

Why? You’ll typically get the lowest price, she says.

Even if you can’t manage to score inexpensive tickets (some of us are Beyoncé fans), you can find other ways to save when you consider the costs of the whole night. Souffrant suggests carpooling or even taking public transportation to the event.

If your concert-going night involves multiple destinations, you may want to turn on push notifications from your bank. You’ll get an alert each time you use your debit card, which may be the reality check you need to curb your spending.

Lastly, look for free concerts in your city. While you might not be able to attend a Beyonce concert for free, there are plenty of other bands and music festivals that offer free concerts.

At a Restaurant

Back to the friends-at-a-Thai-restaurant example: When you’re going out to eat, it can help to speak up about your financial goals.

“If you’re on a budget or you’re trying to save money, don’t keep it to yourself,” says Souffrant.

When you explain your intentions at the start of a night out or before you arrive at the restaurant, your friends will be more likely to understand when you choose to pay only for what you ate and drank.

“I would avoid splitting (the check) equally. That can get expensive if you’re trying to be conscious but they’re not,” says Souffrant.

If you do decide to split the bill, try using Chime’s Pay Friends feature.

At a Bar or Nightclub

If you can avoid a cover charge by getting to your favorite spot before a certain time, then do it, Souffrant says.

You and your friends can also do research in advance to see which local watering holes have special offers or discount nights. Lastly, consider nursing one drink or sticking to water to save money on the bar tab. This way you can still enjoy a night out with friends without overspending.

At an Exercise Class

If your friends are veteran yogis or distance runners, they may have guest passes to a gym or fitness studio that they can share with you, Souffrant suggests.

“You can also just try out the good old park,” she says.

Besides being healthy, workouts at the park are totally free.

“Go together, take a run, take a walk. Use the environment for your own workouts and outside activities.”

Save Money and Have Fun

The tips above make one thing clear: You can meet your savings goals without becoming a hermit.

One final pro tip: Try automating your savings. If you use a Chime Visa Debit Card, for example, every time you use it to purchase concert or movie tickets, or pay your restaurant bill, your transaction will be rounded up to the nearest dollar. And, that round up amount will be automatically deposited into your Chime Savings Account. This way, you’ll save money while you’re out enjoying yourself!

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