Credit Repair and Savings: Three Times to Invest

Saving can be tough, especially when you’re worried about sticking to a strict budget. That’s why it’s important to keep an eye out for opportune moments to present themselves. Keep the following saving times in mind. A lucky break could yield bigger payoffs with the right strategy.

Consider saving:

1. After a business trip.

Traveling for business is a great opportunity to consider money saved at home. If you travel for long spans of time, you’re probably saving a significant amount of money on utilities, food and gas every month. In these cases, why not take your extra cash and reinvest? Networking isn’t the only thing to be gained from business travel.

2. When you score a deal.

Scenario: You have saved $1,800 to replace the window treatments in your home. Luckily, the blind manufacturer is having a fall sale, offering 30 percent off the original price. What should you do with the remaining $540? Sure, you could use your savings to have some fun, but why waste an opportunity for some long-term wealth? Consider:

  • Investing in a Roth IRA. Annual contributions are capped at $5,000, allowing you contribute just over 10 percent with your savings.
  • Adding to your savings account. A rainy day fund is always a good idea, especially when emergencies are usually a surprise.
  • Split the difference. If fun is your first priority, consider using at least a portion of your money to satisfy a long-term need. For example, you could use $250 for a weekend road trip and save the remainder. A windfall doesn’t come along every day. Do your best to make the most of it.

3. When your expenses are reduced.

Let’s assume you have $1,800 in monthly expenses: $900 for rent, $400 for food, $200 for utilities, $100 for entertainment and cell service, and $200 for student loans. Your expenses will decrease next month when you move into a new apartment with a roommate ($650 is your share of the rent). Living with a roommate will also decrease your food and utility budget by half, amounting to $550 per month in savings. While you might be tempted to live more extravagantly, you already know how to survive with less. Why not continue your budget as-is, allowing you to funnel that extra $550 per month into something useful? $6,600 in annual savings could mean big bucks in as little as 10 years. It could also spell early retirement.

The bottom line:

Saving is important, and your goals are made easier by looking for better ways to budget and make the most of the occasional opportunity. Be aware of these moments and use them to your advantage. It’s never too late to improve your financial portfolio.