Having a nest egg of funds to fall back on in times of need is an essential safety net for every family or financially conscious individual. Unfortunately, many people are just getting by from one paycheck to the next without any significant savings. Or, maybe you’ve already started saving but still haven’t amassed an amount of money that most would call a “nest egg.” Regardless of your current financial situation, here are 10 tips you can use to expedite and simplify the building of your future nest egg:
1. Open a Traditional Savings Account
Opening a traditional savings account may seem like a straightforward suggestion but it’s one that cannot be overlooked when saving money is the goal. If you have credit card debts that need to be taken care of before you start saving, using a strategic repayment app like Tally can help you conquer your debt problems to get you on the right track to saving. You might think that opening another checking account or storing your savings in a vault would be sufficient, but savings accounts come with numerous benefits. First, you earn a small amount of interest on the money that sits in a traditional savings account, so your nest egg will be slowly growing on its own. Second, savings accounts make it easy to schedule automated transfers from your checking to your savings account. Take a look at the list of pros and cons of a traditional savings account from Tally to find out more.
2. Make Reliable Long-Term Investments
It might be tempting to dump half of your nest egg into a get-rich-quick scheme, but the better move is to store most of your money in a traditional savings account and then take a fraction of those funds and invest in reliable long-term investments. Here’s a short list of the best long-term investments for securing and growing your nest egg:
- Stock funds
- Bond funds
- Value stocks
- Growth stocks
- Dividend stocks
- Target Date Funds
- Robo-Advisor Portfolios
- Mutual Funds
- Certificate of Deposit
By spreading your nest egg into a few of the investment types above, you can ensure that your savings are appreciating in value over the years.
3. Start a Small Business
Increasing your income is the best way to speed up the process of accruing a large nest egg. In fact, the size of your savings will always be directly proportionate to your annual income. Starting a small business gives you the extra expendable funds needed to start ramping up your monthly saving amounts. Even if your business only earns an average profit of $10 per day, that’s an extra $3,650 per year towards your nest egg. That’s an interesting fact to consider because after ten years you would have a nest egg of $36,500 just by earning a small $10 profit each day. If you were to maintain that minimal pace for the duration of a 30-year mortgage, you would have an extra $109,500 towards your retirement.
4. Do Some Freelance Side Work
If you already have a job or business that you’re committed to, you can still earn extra funds for your savings by applying for remote freelance jobs on the side. If you’re unsure about the types of freelance gigs that are available, browse through the job categories on freelancing sites like Fiverr and Upwork to get some inspiration for the kind of work you could be doing from home. If you don’t yet have any skills in the industries that provide remote work, consider taking a course on a site like Udemy to develop a new skill set.
5. Create and Sell a Product
Did you know that some people have become millionaires just by creating simple shirt designs? That’s just an example of how a simple invention or product idea can make you wealthy in a relatively short amount of time. Spend some time brainstorming with your friends and family about new product ideas and you might just come up with something that investors will gravitate towards. However, keep in mind that you shouldn’t spend too much of your savings to launch your startup as there’s always the possibility that things might not work out as planned.
6. Try Retail Consignment and Reselling
Purchasing an item for a cheap price and selling it for a profit is one of the easiest ways to generate extra income. Try looking for deals locally using online platforms like Craigslist or Facebook Marketplace. Believe it or not, you can often find lots of free stuff that can be individually resold on eBay or even on the same site where you acquired it from. Some stay-at-home moms make a steady income of $1,000-$3,000+ per month just by finding good deals and reselling for a profit.
7. Get a Job in the Transportation Sector
If you’re confident in your driving ability, you may want to take up a job as a truck driver to facilitate a lifestyle that is conducive to saving. There is an abundance of driving jobs available, and it only takes about six weeks to earn a commercial driving license. You can also schedule your own loads as the owner-operator of your own freight-hauling business. The reason why trucking is such a good job for saving is because it provides an above average income while also keeping you on the road so that your funds keep accruing while you travel.
8. Invest in Real Estate
Investing in real estate is a step that every savings-conscious family or businessperson should take eventually. You might think that you need a lot of money to invest in real estate, but with a realtor’s license you could start out earning small commissions and then use those funds to purchase plots of undeveloped land or foreclosed houses that are in need of repair. Homes and land typically appreciate in value, so real estate is usually a wise store of value for your nest egg.
9. Create a Comprehensive Budget
Saving without a budget is like working without a schedule. A structured budget that accounts for all forms of expenditure will ensure that your savings aren’t being hindered by monthly bills and the cost of living. By creating an advanced budget, you may discover that the only way to reach your savings goal is to take up a new career path or apply for a different job. Thus, budgeting helps put your plans for the future into perspective and forces you to take action in creating new streams of revenue that will compensate for your ongoing expenses.
10. Practice Frugality and Bargain Hunting
Frugality is the art of finding ways to save where other people normally do not. There have been countless books written on the topic of frugality, so make this a topic to study in your spare time and you could find yourself cutting your monthly expenses in half or even doing away with them altogether through a fully self-sufficient lifestyle that combines property ownership with gardening and solar power. In addition to curbing your spending, you can also find ways to reduce the amount that you’re spending on essential purchases like hygiene products and food. Combining frugality, minimalism, and bargain hunting can help you live a comfortable lifestyle while still prioritizing the growth of your nest egg.
With a Structured Approach, Saving Becomes Second-Nature
When you don’t have enough disposable income to comfortably set aside a decent amount each month, saving a nest egg can be burdensome. A structured approach that incorporates all of the tips given above will greatly decrease the difficulty of gradually increasing your savings.