Smart saving strategies are within your reach, but you have to take advantage of these opportunities to increase your cash flow and savings. Here are some ways you can make sure you are not flushing your money away.
1. Not Taking Advantage of 401(k) Matching
When you fail to contribute to your retirement account — and thus turn down your employer’s offer of free money — you’re losing out on potentially thousands of extra dollars a year. Sure, that cash isn’t readily accessible for a shopping spree, but it is smartly being set aside for retirement. Your employer will likely set a limit that matches your contributions. For example, if you contribute 5 percent of your yearly earnings to your 401(k), your employer will match that 5 percent contribution. On a $50,000 annual salary, that’s a free $2,500, and on a $100,000 annual salary, you’ll snag an extra $5,000 a year in your 401(k) account. You should also put extra money into an IRA to maximize your retirement investments.
2. Financial Institution Fees
Is your financial institution charging you to use its services? You may not even know it, so review your checking and savings accounts to find out if that’s the case. If you find another financial institution that will charge you less or, better yet, nothing at all to bank with them, make the switch. Similarly, a high credit card interest rate on your balance wastes major money every month. Paying your full credit card balance allows you to avoid these monthly charges. Make the trek to your bank rather than paying unnecessary fees to use another financial institution’s ATM.
3. Not Claiming Unclaimed Money
If you have any unclaimed assets, they are yours for the taking — as long as you hunt them down. Common types of unclaimed assets include the following:
- Cashier’s checks or money orders that were never cashed
- Stocks, mutual funds and bonds
- Open savings accounts
- Utility company security deposits
- Matured savings bonds no longer earning interest
- Closed insurance policies
Your state likely keeps a record of these assets. Visit the website of your state treasurer or controller, where you can search for unclaimed property in your name. If you’re married, don’t forget to search for your maiden name as well, because some of these unclaimed assets are years, if not decades, old. As of 2013, states held an estimated nearly $42 billion in unclaimed assets, according to The National Association of Unclaimed Property Administrators.
It might seem like nothing in life is free — but you might be able to track down some free money along the way. Taking advantage of opportunities to increase your savings, as well as avoiding unnecessary fees, are the first steps toward a better financial future.