How to Save $500 by Dec 31

Our financial world is topsy-turvy.

Each week, Wall Street takes us on another stomach-turning ride, new job cuts are announced and reports from the media leak out comparing our economy now to the Great Depression. With that as a backdrop, it’s no wonder a recent poll showed that 70 percent of Americans are stressed about money right now. The fact is, this isn’t some crisis happening elsewhere to “others” — we’re virtually all feeling the pinch directly.

The net result: stress. People report that their anxiety over bills, mortgage payments, late fees, interest rates and the depressingly low bank balances blinking back at them on ATM screens is mounting. That stress can affect your health, relationships and even your ability to get a decent night’s rest. For most, the worst stress comes from the feeling that you have limited control.

Fortunately, you can take a few simple steps that will help you save a bit, even in the midst of the upcoming holidays. In the spirit of helping you get back some semblance of control over your financial situation, we will show you how to save $500 by Dec. 31. The trick: Take the money you save on little things each week and put it away until the last day of the year.

Sarah on “Discipline”:

Just like weight loss, there is a certain, unequivocal math to saving: fewer dollars out than in. There’s no fudging the math; you just have to be disciplined. With temptation to spend everywhere, sticking to your plan is easier said than done. One of the most effective techniques for staying on track is to visualize the prize. Whether you will use the extra $500 toward paying off some debt, investing in a CD or in your 401(k), or toward a winter trip to Disney World with your kids, if you can keep your eye on the prize, it helps with discipline. So make a goal poster, hang it in a high-traffic area at home and track your progress every day or week. You’ll soon see how your daily choices make a difference. It also doesn’t hurt to get the whole family involved — especially your spouse.

Alicia on “Ditch Perfection”:

Being realistic, you will occasionally slip up — and that’s OK. It’s hard to change habits. Knowing this, it’s important to think ahead and develop tricks for getting back on track quickly if you have a moment of weakness. We recommend a healthy dose of forgiveness followed by one or two significant steps to help you recommit to your plan. If you don’t forgive yourself for slip-ups, you’re actually more likely to throw your hands up, call yourself a failure and keep on over-spending. Bad spending habits may not be easily broken overnight, but if you make room for imperfection, your chances of reaching your goal and developing positive, long-term habits are significantly better.

If you’re having trouble getting your budget in order, here are three tips to help you save up to $500.

#1. Go Homemade
How often do you eat out? Even if you just buy coffee or lunch, it is amazing how quickly ordering out adds up. Making coffee at home instead of buying it every day will save you $90 by Dec. 31 — more if you order expensive lattes or other fancy drinks. Brown-bagging it can cut your daily lunch tab in half. Over eight weeks, you can save $160 to $250. Dinners out also add up. If a family of four eats out, it will cost around $50 at an average restaurant. If you can make a meal for four with around $15, you are saving $35 per week.

#2. Go Generic
Buying generic instead of name-brand foods at the grocery store saves you anywhere from $75 to $100 per month. There’s another $150 to$200 you can save before 2009.

#3. Shop Like It’s 1975
Remember layaway? Instead of paying 13 percent to 20 percent interest on the $1,000 worth of holiday gifts this year, use layaway — you can pay little by little up ahead of time instead of paying a lot extra in January. Money saved (on $1,000): $130 to $200.