This is a guest post from Kristy Ramirez who writes for Life Insurance Finder – where she helps people to compare life insurance quotes and select the best policy to meet their needs at the best possible price.

In theory, everyone believes in the importance of having a savings account. In practice, few people’s savings accounts hold enough to funds to keep them afloat in the event of the unexpected.

Most experts say that, in order to weather a financial storm such as debilitating illness, job loss, or other emergency, you should have a minimum of the equivalent of three to six months’ income stashed away. Given this suggestion, do you feel adequately prepared?

Six month’s worth of income may appear to be an impossible figure to get saved up. But if you follow these 10 commandments of saving money, you can get there!

1. Thou shalt start small.

Focusing on the end result can be overwhelming. Too often, when we feel confronted by the impossible, we simply give up. That’s why it’s important to set smaller goals on the way to the final destination.

If you earn $2,000 per month, don’t focus on getting $6,000-$12,000 in your savings account. Don’t fret about how long it will take you to get there. Instead, plan to save just $500, and decide when you want to have achieved that goal. Once you’ve got $500, focus on the getting to $1,000.

2. Thou shalt not accrue more debt.

If you want to be intentional about building your savings, you need to call a moratorium on using credit. While you may not be able to get rid of all your outstanding debt, you can make a commitment to not take on any more.

If debt is holding you back from trying to save, you may want to seek help. One fantastic resource is Dave Ramsey’s Total Money Makeover. He suggests that you first save up $1,000 in an emergency fund. Then you begin paying off debts using a method he calls the “debt snowball.” If an emergency comes up and you need to use the emergency fund, you stop the snowball in order to get your savings back to $1,000.

His premise is that many of us stuck in the cycle of debt are there because we use credit to take care of our emergencies. Resolving to stop accruing debt won’t stop you if you encounter an emergency and have no other options. The $1,000 emergency fund is your alternate option.

Flickr photo by @jbtaylor

3. Thou shalt make saving #1.

You’ve probably heard the saying, “pay yourself first.” When faced with a lengthy list of bills and household expenses, your natural tendency is likely to simply hope that there’s money left over at the end of the month to put away. However, that is seldom the case. Expenses have a way of sneaking up on us.

Make savings your first payment every month. Work it into your monthly budget just like your home mortgage and utilities, and pay yourself the same way you pay all your bills.

4. Thou shalt make it automatic.

In The Automatic Millionaire, David Bach suggests that you make your payment into savings an automatic withdrawal, on pay day, if at all possible. If the funds are moved out of your regular account before you even sit down to do your banking, you are more likely to try and work with what you do have available.

5. Thou shalt consider the “latte factor.”

A phrased coined by the Bach, the “latte factor” refers to the small change we waste on a weekly (or even daily) basis. Do you regularly stop and grab a coffee each day? Do you eat out for lunch during the work week? Do you smoke cigarettes? These are all things that seem to be small expenses at the moment, but add up to big dollars lost.

For example, if you purchase a latte five days per week, fifty weeks out of the year, you will have spent at least $625 over the course of the year! (Assuming a very low price of $2.50 per latte.) Imagine simply cutting your coffee-buying habits to one or two per week… You would be able to put $375 into your savings account.

6. Thou shalt not make impulse purchases.

One of the biggest killers of the savings account is the impulse purchase. It’s the “I see it and I need it now!” purchase. It’s the “I’ll eventually need it and it’s on sale for a great price today!” purchase. It’s the “It’s only a few extra dollars!” purchase.

Here’s some good advice from Grandma and Grandpa – Sleep on it. Give yourself a day or two to really consider whether you need that item. More often than not, you’ll discover that going back to the store to get it two days later is more effort than it’s worth.

7. Thou shalt have a financial plan.

Big purchases happen. There’s no avoiding the need for a new refrigerator when yours gives out. So what will you do if something big arises? If you decide today how you will deal with that situation, you won’t be caught scrambling. (This is where that $1,000 emergency fund comes in handy.)

In spite of those major expenses that arise, it’s often smaller, day-to-day purchases that eat away at your hard-earned money. How often have you left the supermarket having “accidentally” spent $200 more than you intended? Make it a rule that you will never walk into a store without a list and that you will not purchase items unless they’re on your list. You’d be surprised what you can live without!

8. Thou shalt not spend more than you earn.

This one may seem like a no-brainer, but in today’s “buy now, pay later” society, the majority of the population is living beyond their means. Most wealthy people didn’t inherit it, don’t make 7, 8, or 9 figure incomes, and don’t have a magic formula. Most rich people got that way, says J.D. Roth of Get Rich Slowly, by spending less than they earn every single month.

9. Thou shalt go out of your comfort zone.

Lifestyle change is never easy. You won’t hear someone who lost 50 kg say, “It was easy!” You’ll never find an immigrant living in a foreign land who tells you, “It feels just like home.” Changing your life requires change. And change is never comfortable.

Be prepared to be uncomfortable, so that you don’t inadvertently slip back into your non-saving ways. As a woman in labour bears through the pain of contractions, knowing that the result will be worth the hardship, so you should embrace the discomfort of living more frugally as a necessary step to a greater future.

To adjust to your new way of living, try new things. Look for ways to have fun that are free or inexpensive. Take a class to learn how to use coupons. Discover the unearthed treasures at your local thrift shops. Furnish your house one piece at a time through yard sales and discount shopping. Change is hard, but it can be fun, too!

10. Thou shalt give generously.

A counter-intuitive idea if there ever was one. If you want to save more money, you should give generously. Whether you believe in God, karma, the law of attraction, or the golden rule, it all comes down to one thing – you get what you give.

If you are cheap, stingy, and hard-hearted when you are faced with the needs of others, chances are you will find life to be bitter and lonely. If you are kind and generous, willing to give your last $5 if it will help the plight of someone else, chances are that you will be a person with joy and freedom. And when you’re in need, you won’t need to look far for friends willing to help you.

Take these 10 commandments of money saving to heart, and you’ll be well on your way to a savings account that can carry you through hard times. All you need to do is start today, start small, and keep moving forward, one commandment at a time.

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