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There are a few different ways to budget your money. The round-up method is one of them, but does it actually work?
When it comes to budgeting, you may not initially know where to start. You feel like you have no money at all, and you don’t know where to start with saving money. One thing you may have heard is that the round-up method could be for you.
The round-up method is an excellent place to start. It’s not the only method you’ll want to use, but I’ll get into what it is and how it could work for you.
What is the round-up method in budgeting?
The round-up method is when you save money by rounding up to the nearest dollar. Some people may round up to the nearest $5 or $10. This is something you can adapt as you go. I’ll start with rounding up to the nearest $1.
Let’s say something costs you $3.95. You’re going to round that up to $4. The 5c is going to go into a savings account, whether it’s a piggy bank or in a bank saving account. This is going to depend on how you spend the money, and I recommend having both so you can mix and match the way you pay for items.
Why the round-up budgeting method works
The benefit of this method of budgeting is that you’re not going to immediately affect your finances. You’re rounding up to the nearest dollar, which in some cases will just mean putting an extra couple of cents into the piggy bank. Sometimes it will mean putting 99c into a piggy bank.
You immediately start saving money*. There’s no need to worry about saving a set amount each month. It’s just all about how much you’re spending and how much you’ll be able to round up to each time.
The downside is that you have to go into your account to round up, especially if you pay by debit or credit a lot. You’ll need to be vigilant each day to round up the money, and that takes time to get used to. Don’t worry if you’re not vigilant one day or another. This isn’t about being perfect right away. It’s about being successful for you.
As you start to see yourself saving, you’ll get a boost to save more money elsewhere. You’ll gain confidence in your own money management, and you’ll see the success build up. If you’re struggling with money and budgeting, this is where you can start and immediately see success.
What is your favorite method of budgeting? What do you think of the round-up method of budgeting? Share your thoughts in the comments.