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Whether you are paying off a loan, planning a vacation, or saving for your first home purchase, being able to earn extra money when needed can help fast-track meeting financial goals. Luckily, there’s often untapped potential to increase your earnings.

Financial advisers emphasize that the key to taking control of your spending is to track it. Doing this allows you to create a plan that aligns with your values and control where your money goes, instead of always wondering where it went. “The most important thing you can do is set up a system to monitor and have self-awareness around your budget,” says Melissa Weisz, a certified financial planner with CI RegentAtlantic Private Wealth.

1. Create a realistic budget

Managing your spending habits with a budget is a great start to skillfully managing your finances. Once you’ve mapped out what you make and where it all goes, you can then diagnose potential spending issues and ways to cut or reduce unnecessary expenses.

But before you start a budget, it’s important to keep one thing in mind: The trap a lot of savers fall into is putting themselves on a budget that is not realistic enough. On one hand, many fail to account for emergency expenses or aren’t accurately tracking how much they spend on any given category.

Yet budgets that are too restrictive can also fail. Everyone needs to account for spending on experiences that come up spontaneously or are worth it to them and bring them joy. “A lot of people don’t budget their guilty pleasures,” says Justin McCurdy, certified financial planner from Manhattan West. “I think it’s important to keep those things in mind that you like to spend money on just for your personal happiness and peace of mind.”

Luckily, technology makes budgeting easier. Apps such as Mint and Goodbudget can help you track your monthly spending. Many banks have website features where you can automatically see what categories have taken up the majority of your monthly spending.

Some budgeting methods that work for savers you can experiment with are:

  • The 50/30/20 rule, which encourages you to allocate your earnings with the formula: 50% to after-tax income essentials, 30% on wants, and 20% on savings and paying down debt.
  • Pay-yourself-first budgeting, which means prioritizing s goal-based saving categories like retirement and investments instead of arranging your budget around short-term expenses.
  • Zero-based budgeting is a technique where you design your budget to ensure that every single dollar of your earnings goes toward a specific payment or savings goal, so your total income minus your expenses equals zero.
  • Envelope budgeting is a money-saving strategy that consists of dividing your take-home pay into spending categories, labeling an envelope for each category, and putting the cash you plan to spend into the envelopes.

2. Make sure that your spending aligns with your goals

When cutting back on monthly expenses, put your spending within the context of your larger values and goals to gain some perspective. Similar to budgeting, there is no one-size-fits-all advice for where you should cut back on spending, because what is essential for you could be not worth it for another person.

For example, the advice to cook more and eat out less is a generalized recommendation that people trying to save money are told often. Yet it’s more important to cut spending in areas that make sense for your lifestyle. “It’s hard to tell somebody, ‘Hey, don’t do this, don’t eat out as much,’ because if it’s saving them time and they don’t like to cook, that might not be the area that they want to trim,” explains Weisz.

Ultimately, keeping track of your saving goals is motivational. Seeing yourself get closer and closer to reaching the finish line is a great way to put spending in perspective.

3. Automate your savings

Sometimes the process of putting away extra money each month might seem like a hassle. Luckily, technology can help to automate it all. That way, you can take the mental energy out of saving and streamline the process. You can automate payments to investment accounts, savings accounts, or to pay off loans.

Just the process of automatically putting part of your paycheck away for savings causes a bigger difference in your savings than people realize, because oftentimes you won’t even miss the extra money in your checking account once it’s not immediately available for spending.

And this includes not only saving money but investing. By automatically setting aside part of your income for investment accounts like a 401(k), Roth IRA, or mutual fund, you benefit from the growth of the stock market over time.

Another tip to save: Find a credit card that gives you points that align with your spending. “One thing I don’t think people spend enough time researching is finding a credit card that has a rewards system that is aligned with your spending habits,” explained McCurdy. “You should pick the card that gives you the most points for food and restaurants because that’s where you spend most of your money. That way, you’re maximizing your points via the rewards system.” Some credit cards offer points for travel, restaurants, and spending on specific products.

4. Utilize your employee benefits to their full capacity

Another way to save and earn extra is by taking advantage of the full range of benefits offered by your employers. A key benefit you shouldn’t miss out on is the 401(k) match. Many companies will match a certain percentage of income that you put into a 401(k) retirement account. The benefits of compound interest supercharge retirement accounts. “Understanding all of your employee benefits to make sure that you’re utilizing them to their full capacity is huge,” Weisz says. “Make sure you’re capturing your full employer match to your 401(k) and managing your health insurance through your employer,” she explained.

Other common employer benefits include:

  • Commuter benefits
  • Reimbursements for cell phones or gym memberships
  • Life insurance
  • Prescription and pharmacy benefits
  • Financial planning services
  • Professional development coverage

While some of these may seem like incremental savings, taken together they can add up to a few hundred dollars per month.

5. Don’t forget about your taxes

Making sure you are maximizing savings on taxes, which is a huge opportunity to save hundreds of dollars. Weisz explains that people should look for tax deductibles offered in their state, and make sure that they understand the most common tax credits available to them.

Tax deductions lower your taxable income, which makes your overall tax bill smaller. Above-the-line deductions include tax deductions that are taken directly out of your paycheck, like contributions to a retirement account or spending on a health savings account.

Below-the-line deductions are expenses that are subtracted from your income to determine how much of your income is taxed. Standard deductions for 2023 are $13,850 for a single person filing, $27,700 for a married couple filing jointly, and $13,850 for a married couple filing separately, and $20,800 for a single person with dependents.

A tax credit actually lowers your tax bill. Many common credits you could qualify for are:

  • American opportunity tax credit: This earned income tax credit lets you claim the first $2,000 you spent on educational expenses like tuition and books.
  • Earned income tax credit: The earned income tax credit is a refundable tax credit for low- to middle-income people. You can get between $560 to $6,935, depending on tax filing status, income and number of children.
  • Child tax credit: With this earned tax credit, you can get up to $2,000 per child depending on income and tax filing status.

And remember that taxes extend beyond filing—they affect how you invest, which is why it’s important to ensure you have a tax-efficient portfolio. That means minimizing the taxes you pay when it comes time to cash out on any assets.

This can be done a number of ways:

  • Harvest losses to offset gains: This is a strategy in which investors sell investments that have lost value to lower capital gains tax on investments that have grown.
  • Hold on to assets to avoid short-term capital gains: Gains recognized on stocks held for a year or less are taxed at federal ordinary income rates, yet if you hold on to assets for the long haul, gains recognized on stocks held longer than a year are taxed at the federal long-term capital gains rate — currently 15% for most investors and 20% for high-income taxpayers, plus the potential 3.8% net investment income tax.
  • Invest in tax-efficient funds: Some mutual funds are structured specifically to minimize tax liability. These funds avoid taxes by limiting the turnover of their holdings, investing in municipal bonds, and limiting income generating assets which accumulate high tax bills.
  • Consider investing in municipal bonds: Municipal bonds are debt securities issued by state and local governments. Income earned from municipal bonds is generally income-tax-free at the federal level. In some cases, they are tax-free at state and local levels too.

6. Maximize your earning potential

The most effective way to save more money is to make more money. Consider asking your employer for a raise or searching for a new job that pays a higher wage. You can research the market rate for your job using tools like Glassdoor, or even ask colleagues and people in your industry. Lots of people could be making more money and aren’t aware of it. According to data from the Pew Research Center, from April 2021 to March 2022, 60% of workers who switched jobs experienced increased earnings.

By developing your marketable skills, you can also qualify for a raise or a higher position at your current employer. One option is LinkedIn Learning, for which some employees can get subscriptions through their employer. At full price, the service is $25 per month. Google Career certificates are another option, which offers courses for roughly $39 per month depending on the class; however, there are scholarships available.

If you have the time and interest, consider starting a side hustle. Roughly 10% of workers reported having a main job plus at least one side hustle, according to a recent survey. Reporting, freelancing, report writing, and programming are all popular side hustle options. Selling items on eBay or on online thrift stores, tutoring, and even renting a room if you have extra space can all be lucrative side hustles.

Depending on your skill set, side hustle gigs can pay anywhere between $30 and $70 per hour. If you work an extra 15 hours per month making $50 an hour, your extra cash comes out to $750.

The budget that will be the most effective is the one that is personalized to you. No matter how much extra cash you aim to save, spending some time tracking your spending in the last month will provide crucial information that will be the starting point for designing your savings plan.

This article was written by Lucy Brewster from Fortune and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to [email protected].