Searching for some easy ways to save a few loonies

A friend once said that while it was all well and good to recommend saving for retirement, what money is ever left over to save?

It’s a valid point. The cost of living continues to rise – groceries that used to be $100 for four bags are now more like $100 per bag. We are happy when we find gas at the pump for under $1.90 – we paid below $1.20 mere months ago.

So how can we free up a few loonies for saving? Save with SPP investigated.

The MoneyLion blog via AOL starts us off with a few solid ideas.

Open a high-interest savings account, the blog advises. “Why work hard to save money just to park it in an account that generates close to nothing in interest? A high-yield savings account will supercharge the impact of all the other savings steps you take.”

Another bit of good advice from the blog is to “pack a lunch at least every other day” when you roll out for work. “Limiting lunches out to every other workday can be a simple way to save $5 to $15 per meal — easily $100 over the course of a month,” the blog suggests.

Finally, a classic idea – “make a list before heading to the grocery store,” MoneyLion suggests. “It’s amazing how planning a list of purchases before each weekly shopping trip will prevent you from coming home with an extra bag filled with potato chips, soda and frozen pizzas.” Keeping to your list will get you in and out of the store faster and having spent less.

Over at the Money Bliss blog, poster Kristy offers up some more ideas.

A unique one – bank every $5 bill you get.

“Every time you get a $5 bill, put it aside in a jar or an envelope and let it add up over time. This simple habit can turn small amounts into a bigger fund.”

Another slightly outside the box idea in this age of paying by tap is to use cash. Very old school.

“Paying with cash makes you think twice before buying something because you see the money leaving your hands,” writes Kristy. “It’s a great way to control impulse spending. When you stick to only using cash, it’s easier to track how much you have left and stick to your budget.”

A final good thought – “turn unexpected income, like bonuses and refunds, into immediate savings,” the blog suggests.

“Any extra money you weren’t planning on, like a bonus or a refund, should go straight into savings and investment accounts,” Kristy writes. “Since you didn’t expect to spend it, you won’t miss it.”

Let’s add in a few more from Reader’s Digest Canada.

Buy staples, such as pet food or meat, in bulk. “If you can afford the upfront cost, you may be able to save big by purchasing larger quantities of meat from a local butcher or a bulk grocery store and freezing it for later use,” the magazine advises.

Another tip is to build an emergency fund to help pay for future problematic expenses, like sudden home or car repairs.

“You can mitigate the impact of unexpected expenses by putting a small amount of money into an emergency fund each month. Talk to your bank about high-interest online savings accounts, which are typically free and also tend to offer higher rates compared to a regular savings account, making them perfect for rainy-day saving,” Reader’s Digest Canada tells us.

A final thought – your fridge should always be nearly empty, not jammed full. Huh?

“Empty the fridge before bringing in more food. That means keeping track of what’s already there, eating leftovers, coming up with creative recipes for leftover produce and not buying new condiments (i.e., finish one bottle of salad dressing before buying another). It’s made for almost zero food waste and approximately $50 each week in savings—that’s around $2,500 a year,” the article enthuses.

Two from us to finish the article. First – this one was featured in a book we reviewed a few years ago – was to simply live on 98 per cent of what you make, and to bank the other two per cent. Amazingly, this works, especially if you automatically whisk the two per cent into savings before you have a chance to spend it.

Second, we took all scratch card winnings, money from bottle returns, rebate money from eyewear, dental plan refunds, and even Visa gift cards and used it to contribute to our Saskatchewan Pension Plan (SPP) accounts. These little bits of money really added up over time.

Thanks to SPP’s low-cost, professionally managed pooled fund, our savings grew and we both enjoy a lifetime monthly annuity payment (with survivor benefits for each other) that arrives like clockwork each month.

See what SPP can do for your drive to save for retirement. Check out SPP today!

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Millennials face a variety of barriers to saving

Writing for MoneyLion, Dawn Allcot identifies a number of barriers that are impacting the ability of millennials to save for retirement.

Millennials are today between 29 and 42 years of age. Allcot refers to them as “the generation often scolded for their love of pricey pleasures like Starbucks and avocado toast (that) now find retirement looming just a few decades away. Only 42 per cent are on track to retire by age 65,” according to research from Vanguard, she writes.

So, what’s blocking their savings efforts?

Top of the list, the article notes, are student loans.

“Student loans are a big problem for millennials, states Quote.com finance expert Melanie Musson in the article. “Laws that keep loans affordable for lower-income individuals also leave them with just as much debt 30 years after college or graduate school as they had when they left. It’s a huge problem to pay toward the loan every month without chipping away at it.”

The rising cost of housing is another barrier to saving, the article continues.

“Millennials are juggling mortgages that cost more than their parents’ first homes,” Julia Bartak, financial advisor at Edward Jones, tells MoneyLion. “High home prices and high interest rates mean they’re devoting larger portions of income to housing than prior generations. There’s an emotional response to feeling like all their financial bandwidth is going toward their mortgage, and that can push retirement savings to the back burner.”

Rounding out the top three is credit card debt.

“Debt is holding many millennials back from properly preparing for retirement. Experian data shows that 77.9 per cent of millennials have credit card debt, with average balances close to $7,000,” the article notes. This data is U.S.-generated, so that figure is in American dollars.

The tough economy and related difficult job market is also impactful when it comes to saving, the article notes.

 “Wages haven’t matched housing, childcare and healthcare cost increases. Basic expenses are taking up a big chunk of their income, so they’re not saving consistently. When you fall behind it’s hard to catch up, even as a high earner today,” the article notes. While we may not have the same healthcare costs as folks in the U.S. must deal with, the rising cost of living is a hot topic – and savings barrier – here in Canada.

Some millennials are part of the “sandwich generation,” where they are looking after aging boomer parents while raising kids of their own.

“Millennials are sandwiched between the declining baby boomer generation and the booming Gen Alpha,” states Mawuli Vodi of Financially Present in the article. “They have retiring parents who may or may not be able to support (their children) because they are settling into their own wants. Meanwhile, their Gen Alpha kids require a significant amount of help. Even if all goes well, Gen Alpha may end up living at home with their millennial parents.”

And even if the millennials inherit, a general lack of financial literacy may limit the benefits of the transferred wealth, the article concludes. Those receiving an inheritance need to “manage it well, protecting yourself and your family. Lack of financial literacy and poor planning is the biggest threat,” the article warns.

If you make long-term savings a part of your monthly budget, and automate that process, the money will zip into savings before you have a chance to think about spending it and will quietly build for your future.

The Saskatchewan Pension Plan provides great flexibility around automating contributions. First, it is you who decides how much you want to save. Then, you can set up pre-authorized contributions from your bank or credit card (PAC-PCC-application.pdf).

Once SPP receives your contributions, we invest them in our low-cost, professionally managed pooled fund, growing your savings until it’s time to collect them at income. When that day arrives, your choices include the security of a monthly annuity payment for life that can never run out, or the more flexible Variable Benefit.

Check out SPP today!

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