Saving for a want

Saving for a special treat, such as a vacation, electronic gadget, or other toy will probably require some cutbacks, but it isn’t impossible to do. In fact, by making these simple changes in your life, you probably won’t have to make major sacrifices.

Consolidate your credit card debt

An average American family has about six different active credit cards. Odds are, at least one of them has a lower interest rate than the other ones. By transferring your balances to this card, it’s possible to save hundreds of dollars a month in interest charges.

Review your utility bills

After your rent or mortgage and car bills, your third largest expense is probably electricity and water. Walk around your home and look for ways to save energy. Turn off lights, raise the temperature on your air conditioner, and check the insulation around doors and windows. Even after saving money for a vacation, you’ll continue to enjoy lower electric bills.

Make some cuts to your “optional” utilities

Cell phones, cable subscriptions, and even internet plans typically offer cheaper options than the ones many people are encouraged to sign up for. Switching to a pre-paid phone, eliminating movie channels, or agreeing to a slower internet speed can all help you to save over a hundred dollars a month. After a few months, you’ll have enough to go on a vacation.

Force yourself to save first

Figure out how much you need for your trip, then divide that number by the number of paychecks you’ll get until then. The result is the amount you should transfer directly into a savings account on each payday. You’ll have the money you need for your trip, but you will have to rework your budget to get your spending in line with your reduced income. Keep in mind this plan usually only works if you have a lot of money that is being spent each month on wants instead of needs. Otherwise, you might just end up running up your credit card balances.

Consider some less expensive vacation options

If you just can’t save the money for your dream trip, look at ways to reduce the cost. Delaying the trip a few months can give you more time to save and it might let you go during a cheaper time of the year. Picking cheaper hotel or looking for ways to avoid eating out can save hundreds of dollars. Also look for last minute deals to the places you want to go.

Break up the purchase into smaller pieces

While this isn’t always possible, it can be a good way to make sure you stay motivated. If you’re saving for a vacation, for example, it can help to purchase the plane tickets, then continue saving to purchase the hotel room. Of course, make sure you are comfortable with the fact that if you cannot save the money, you might be stuck with only part of a trip. On the other hand, this threat is just the motivation that some people need to finish saving.