How to Save Half Your Income
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Saving half of your income seems impossible, but it can be done. Here are the best strategies to save more without living like a monk!
Are you ready to go big this year with your money? How about saving half your income?
Sounds crazy, but it's doable. The masterminds behind Stacking Benjamins want to show you how.
How to Save Half Your Income
Joe Saul-Sehy and Kathleen Celmins the minds behind the hit personal finance podcast Stacking Benjamins are here to share their best tips to help you increase your savings rate fast.
In this episode we get into:
- the step by step process towards saving half your income
- how to find and fix money leaks in your budget
- earning more at work
Hope you enjoy!
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Handy Resources to Increase Your Savings Rate
If you’re looking to get ahead with your finances as a family, here are key resources to check out!
- Best Budget and Money Apps: Personal Capital, Tiller, Mint
- Grow Your Stash Faster: High Yield Savings with CiT Bank
- Manage Your 401(k) Easily: blooom
- Automatic Saving: Qapital
- Jumpstart Your Marriage and Your Money
- Simplify and Enjoy: Financial Freedom for Families
Meet Joe of Stacking Bejamins
Joe Saul-Sehy is the co-host of the award-winning Stacking Benjamins podcast, which focuses on earning, saving and spending with a plan.
Since 2012, Stacking Benjamins has used the science of play to make finance more approachable, interesting, and fun.
While some podcasts hope to be the final expert in the chain of money lessons, Stacking Benjamins hopes to introduce you to the broad spectrum of ideas, concepts and technologies that can help you lock in a better financial future.
The Process to Saving Half Your Income
Most people might wonder how in the world they can save that much money, but it's really not complicated.
It comes down to five steps:
- Figure out your magic number
- Find ways to cut expenses while still living like a regular person
- Find ways to make more mone
- Where to put all that money after you've saved it
- How to keep going for the rest of your life
The trick, though, is following through on the process. The good news is that it is possible.
Save More By Changing Your Systems
Changing your habits can seem impossible, but if you can set up systems you can automate some of the process.
This can help you stay focused on your goals without having to interrupt your routine.
One great suggestion from Joe – depositing your paychecks directly into savings. You can then set up transfer from there into check for the bills.
This change has been a tremendous help for couples, allowing them to save so much more than if they waited to save after the bills and other stuff comes out.
Save Half By Spotting Money Leaks
Reviewing your spending together can be worth the effort.
Joe pointed out two of the biggest culprits when it comes to money leaks were:
- eating out
Many couples don't have a budget for entertainment and eating out is usually way underestimated.
There are a few ways you can keep your spending in check, depending on what motivates you:
- Alerts: You can set-up through your bank, credit union, or services like Mint to text/email you when you spend a certain amount.
- Envelope system: take out the cash and put it in a small envelope or a fold of your wallet. Once that money is gone, you're done for the month.
I personally like the alerts, but my husband is more of a cash man.
Earn More and Build Wealth
While saving and optimizing your spending is crucial, it's only part of the process. Making more can help you reach your financial goals quicker.
While side hustles can be a wonderful to boost your income while expressing your entrepreneurial spirit, it's not your only option.
Joe suggest negotiating with your current job better salary. You can come from a position of strength if you prepare ahead of time. Reserach what value you can add to the company (along with the corresponding pay).
Save Half Your Income
Community is critical if you're looking to make big changes. The comadarie and accountability can make all the difference.
If you are looking for a supportive and encouraging tribe to push you to save half, please check out Save50.
They have resources including a private Facebook group that will help motivate you when things get tough.
If you're a Stacking Benjamins listeners you know that they put out great content for their community. This course is wonderful way to stay focused all through 2016.
Even if you don't save half, you're more than likely to be in a much stronger position having tried.
Thoughts on Saving Half Your Income
Whatever your savings goal, I wish you the best!
I'd love to hear what you have planned this year. What changes have you already made to help you achieve it?
Support the Podcast!
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Like the music in this episode? Our theme song is by Gentle Regime. Additional music by Lee Rosevere.
This episode was originally released in January 2016. Show notes were updated in June 2019.
We’re a two-person team, so we decided to live wholly on one person’s income (preferably the person with the LOWER take-home-pay), so we could save,invest 100% of the other person’s income. That’s our way of halving our income, but these are great options for us to save even more and potentially live on less.
Great plan! We do something similiar – my husband’s income is for paying the bills and mine is used for savings and other financial goals.
I love how you guys are working together!