Five Mental Money Jedi Tricks to Build Up Your Rainy Day Fund

Most financial advisors suggest that a good rainy day fund or emergency savings fund contain three to six months of average living expenses. If you have a monthly mortgage payment, car payment, and some kiddos running around the house, that can really add up! How in the world are you going to save up that much, especially if you feel like you don’t have a lot of spare change at the end of the month anyway?

You can do it, and you don’t even need to obsessively clip coupons or ration the shampoo and dish soap. Here are five powerful mental tricks that can make saving easy and painless.

• Move the Goal Posts Closer – Small Goals

Six months’ worth of living expenses for a family of four may add up to $24,000 or more depending on your particular financial needs. That may seem like an impossible savings target to hit, so move the goal posts closer. Start with a goal to save $2,000. This is about the cost of a major car repair, exactly the kind of surprise financial setback that can throw a couple on the edge into a deep hole of debt. You can save $2,000 in a year if you just put a little over $150 into an online savings account per month. That’s a lot more reasonable that trying to save $24,000, right? If $150 a month is too tough, then start with saving $100 a month. Even just socking away $50 a month will see you with $600 in savings at the end of a single year. You can use our WIFE savings calculator to see how much this can grow over time.

• See Not, Want Not — Automatic Withdrawals

If we have money, we tend to spend it, which is why using automatic withdrawals for retirement and savings accounts can be so powerful. Choose a monthly amount you are comfortable with and then set up an automatic withdrawal from your checking account to your rainy day account. If you don’t see the money, you won’t miss it when it is gone.

• Cut Out Impulse Buys – Institute a 24-Hour Moratorium on Big Spends

We’ve all been in a situation where we were tempted to buy some amazing new toy or take advantage of a “once-in-a-lifetime” sale. Retailers and salespeople know that our emotions can overpower our better judgment, and they play all the tricks in the book to encourage us to make impulse buys. Stop yourself from making a purchase that you’ll later regret by instituting a 24-hour wait period on any purchase above a certain amount. Your magic number may be $100 or $500. Whatever it is, stick to your guns. You may find that 24 hours gives you enough space to make a smarter and more considered buying decision.

• If You Can’t Match It, You Can’t Afford It – Match Your Indulgences

We all have indulgences that make life a little bit sweeter. Maybe you love to take yourself to the movies each week, grab a juicy hamburger after work, or throw a gossip magazine on the register at the grocery store. Indulgences are fine…if you can afford them. They should never take the place of savings. To ensure that you can afford indulgences, make a commitment to match the amount you spend on indulgences with an equal contribution to your rainy day fund. If you spend $5 on fast food or $12 for a movie ticket, put that same amount in your savings account. If you can’t afford it, then you eliminate or pull back on your indulgences.

• Get Healthy and Save – Eliminate a Vice

Our vices don’t just hurt our bodies and our relationships, they hurt our wallet as well. For instance, the average cost of a pack of cigarettes is $5.51. If you smoke a pack a day, you’re spending over $2,000 a year on your habit. If over-indulgence in television is your vice, cut the cable cord, save an average of $90 a month, and spend more time outside walking and exercising. Similarly, gambling, drinking, or over-eating can all cost you in the long run. Cut these habits, and you’ll have a happier life and a healthier savings account.

Did you like this article and want some more great savings tips? Check out our entire archive of articles on budgets and planning.