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How to Save More of Your Paycheck

By Kathleen O'Malley |

“Spend less than you earn” is a common refrain in personal finance. It’s a little like, “burn more calories than you consume” when it comes to losing weight.

That is to say, obvious, but not easy.

However, I’ve been using a trick that has saved me thousands of dollars in just a few months.

how to save more of your paycheck

via Babble

Here’s my secret to save more money, and one you can employ, too.

Open another account at a different financial institution and deposit a certain percentage of your paycheck there.


Seriously, that’s all there is to it.

I set mine up to put 50% in my normal account (the one where all the bills are auto-deducted) and 50% into a savings account.

Actually, it’s not a savings account. It’s an interest bearing checking account, and it has rules we need to follow in order to earn the relatively high interest rate.

So, after I put half my paycheck each month into this account, I dutifully use my debit card for 12 small transactions. Then, I put my debit card away and for the rest of the month, I use my rewards credit card.

I was worried about this approach initially, because… would I have enough money? Would I be able to access my savings if I needed to?

Turns out, the answer is yes. I have enough money (we all do). And one month, when I didn’t? I just had to walk into my credit union and ask them to transfer money from the other credit union. They’re all connected, see, so it’s relatively easy to do it.

But not too easy! And that’s the key. If it’s too easy, then you won’t save. If I could transfer money between accounts online, I probably wouldn’t have as much saved.

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About Kathleen O'Malley


Kathleen O'Malley

Kathleen O'Malley is the creator of the personal finance and frugal living blog, Frugal Portland, where she writes about fun, frugal things to do in her hometown of Portland, Oregon as well as ways to make the most of our short time here on the planet. Topics include living simply and having fun on a shoestring. Read bio and latest posts → Read Kathleen's latest posts →

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One thought on “How to Save More of Your Paycheck

  1. Amanda says:

    Great idea! I did this when I was planning to get a car. I automatically transferred $400 each month into a high interest account. This made sure I could afford the monthly car payments and helped me build a nice down-payment.

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