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How to Save for a Big Purchase

Plan for Upcoming Expenses by Earning More and Spending Less

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Essentially, there are only two ways to save for a big purchase: earn more or spend less. As a single parent, you may feel like those options just aren't possible, given the current demands on your time and finances. However, you really can save money when you put your mind to it and make it a regular habit. Here are ten ways to save money toward an upcoming expense:

1. Put money into your savings account each and every month.

If you're trying to save up for a big purchase, the first thing you need to do is set up a savings account through your regular bank. Then, ask them to withdraw money each month from your checking account and deposit it into your savings account. Having them do this automatically for you will help you save money simply by not having it in your checking account to spend.

2. Work overtime.

If you have the option to work additional hours, consider building enough overtime into your schedule to cover the item you want to purchase. Just remember to also consider the potential expense of additional child care while you're working.

3. Temporarily take on a second job.

This is another relatively easy way to earn additional money. Keep in mind that a "second job" doesn't have to mean that you'd be earning minimum wage pay, either. Take a skill you already possess and find a way to share it with others. For example, if you're a teacher, consider tutoring 1-2 hours per week. Additionally, you can earn money from home by babysitting for other people's children, pet sitting, or starting an on-the-side laundry business. Use your creativity and consider where the skills you already possess meet a need in your community.

4. Sell items through an online auction.

Take a good look around. What do you see that you don't use, need, or love? These may be items that could earn you some money on an auction site like eBay. Keep in mind, too, that the U.S. Postal Service will deliver Priority Mail boxes right to your house free of charge. You can then buy your postage online, print it out, and have your postal worker pick the package up right at your front door. This takes a lot of the "hassle" out of the idea of selling items online.

5. Cut back on your grocery bills.

Another quick way to save toward a big purchase is to spend less on non-fixed expenses, like groceries and eating out. Make an effort to plan your meals and look for recipes that are economical. Being intentional about how much money you spend per meal can help you save toward the big purchase you have in mind.

6. Research the item you want to purchase.

Spend some time researching your purchase online. For example, visit Pricegrabber.com to compare prices on electronics and more. In addition, see if you can't purchase the item you're looking for through an auction site, such as eBay.com.

7. Separate needs and wants.

Sometimes we have to reevaluate our expectations and purchase a less-expensive option that may not have all the "bells and whistles" we were looking for. To help you separate what you need from what you want, take a sheet of paper and divide it into two columns. On the left, write down the features this big purchase must include. Then, on the right, write down the features that you'd like to have. Then compare the results to the options that are in your price range.

8. Wait longer.

Sometimes you just have to wait a while longer before making your big purchase. For example, if you'd like a larger TV, and you're able to set aside $40 per month toward a new one, saving for an extra six months would give you an additional $240 to spend. In addition, if you're expecting a generous tax return in the next twelve months, waiting for it is another painless way to save for a big purchase.

9. Avoid using credit.

Using credit cards to purchase items you can't really afford to buy is like paying an extra 18-20%. Even if you think you're "saving money" by getting the item on sale, it ends up costing you more when you purchase on credit without having the ability to pay off the account balance at the end of the month.

10. Reevaluate your housing options.

You may also find that no matter how much you cut back, you're still spending too much money on housing. When that happens, your options are to either move to a location you can really afford, or consider renting out a room. Organizations like Coabode can help you find other single moms in your area who are also interested in sharing housing expenses.

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