If your savings account could use a lift, you’re in very good company. An estimated 63% of Americans don’t have enough cash reserves to cover a $500 unplanned expense, according to SecureSave data.
But while working toward a $500 savings balance is a great thing, $1,000 in the bank could buy you even more financial protection. And while it might seem impossible to accumulate an additional $1,000 by the end of the year, with the right strategies, it could be doable. Here are a few tactics worth trying.
1. Pick up a side hustle
The holiday season will soon be upon us. And that means businesses are apt to need more hands on deck.
Some seasonal work can begin as early as late October. So if you’re able to get a side job that has you earning $100 a week, guess what? After 10 weeks, you’ll be $1,000 richer.
But to be clear, if you’re interested in getting a seasonal side hustle, you should really apply now. Data from Challenger, Gray & Christmas shows that U.S. retailers are expected to hire fewer seasonal workers this year. The sooner you apply, the more likely you may be to get hired.
2. Unload a car
Getting rid of a car isn’t something everyone can do. If you live in the suburbs and don’t have access to public transportation, this won’t be feasible. But if you live in an area where it’s possible to get by without a car, dumping yours could save you a lot of money.
AAA puts the average cost of vehicle ownership at roughly $900 per month. So getting rid of your car by, say, November, could make it possible to add $1,000 to your bank account by the end of December. Even if you’re forced to bear the expense of extra trips via ride-hailing apps after dumping your car, you might still come out $700 or $800 ahead on a monthly basis.
3. Automate contributions to a retirement plan
Perhaps you’re doing okay as far as an emergency fund goes, but you’re lacking in the long-term savings department. If that’s the case, a good way to grow your IRA or 401(k) by the end of the year is to automate contributions of $333 a month between October and December.
If you have an IRA, you can set up an automatic monthly transfer from your bank. If you have a 401(k), you can sign up for your employer’s plan and have contributions deducted from your income automatically.
Of course, you may be thinking, “But where’s that $333 a month going to come from?” That’s the tough part. You might have to cut back on spending to a large degree to make those contributions possible. And during the holiday season, that’s even more challenging. But if you enlist the help of friends and family members, you might manage to make it happen.
Tell your friends you’re committed to saving an extra $1,000 by the end of the year and ask them to join you in pursuing free entertainment on evenings and weekends. Tell your family that you’re eager to boost your long-term savings, and ask that they accept the fact that you’ll be giving out modest, homemade holiday gifts this year instead of extravagant ones.
Cutting spending to the tune of $333 a month won’t be easy. But you might end up really happy when you see your retirement plan balance grow by $1,000 in just a few months.
Saving $1,000 by the end of the year might seem like a tough thing. And it definitely is — don’t kid yourself. But just because it’s hard doesn’t mean you can’t do it. If you manage to hit that goal, you’ll get to start off 2024 in an even stronger financial position.
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