$imple strategies

Set a goal

Whether it’s a trip to Japan you hope to take in a few months or saving for retirement, having a very specific goal will help you stay motivated and on track.

Track your dollars

The best way to get on track to saving is to spend less than you earn. Tracking your spending — either through a daily journal or an app — can help you do this.

Trim spending

Consider trimming expenses. Once you know how much you’re spending monthly, you can decide what areas you’d like to cut back on so you can meet your savings goal.

Two birds, one stone

For those with low to moderate incomes, paying off debt — including the mortgage — is the best taxplanning you can do. That’s because you don’t pay taxes on the capital gains on your home and there’s no tax on the return you get for getting out of debt.

Automate it!

Set up an automatic transfer of funds to a savings account (or TFSA or RRSP) so a set amount — say

10 per cent of your gross monthly income — comes off your paycheque automatically.

Pay less tax

Slash your taxes by making sure you use TFSAs and RRSPs properly. Hint: Generally speaking, TFSAs if you make less than $50,000 annually, and an RRSP if you make more than $50,000.

Don’t tempt yourself

Cut temptation to control spending. Forget roaming through malls and bookstores where impulse buys are common. Instead, hit the gym or join a book club.

Stack it

One strategy to pay off debt quickly is the stacking method. It asks you to list your debts in descending order from highest interest rate first on down. You make minimum payments on all of your debts while directing the remainder of your funds towards the loan with the highest interest rate. Once that’s paid off, you tackle the next highest interest rate debt on your list.

Let it snowball

This is where you focus on paying your debts from the smallest amount to the highest by making minimum payments on all your debts and putting the remainder towards the one with the lowest amount owing. Paying off a small debt can lead to a feeling of accomplishment, which is an important motivational factor for those who may feel overwhelmed by their debts.