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Money Saving Secrets of Super Savers

In this month’s edition of Money Magazine they interviewed 100 dedicated savers to learn their stories and find out the tactics they employ to save 35-60% of their income. All of these couples and individuals are well on their way to a very comfortable early retirement.

1. They set goals, and they make them specific.

Behavioral finance experts have found that earmarking accounts for particular goals can have a dramatic effect on savings rates. In a 2009 study, Amar Cheema of the University of Virginia and Dilip Soman of the University of Toronto found that labeling a college fund with the child’s name nearly doubled how much was saved. “When you know what you’re saving for, it’s close to your heart and you’ll feel regret if you stop,” says Cheema.

2. They live below their means

They purchase homes and cars based on what they need versus what they can afford.

3. They delay gratification

Super savers don’t make impulse buys and often save for months in order to pay cash.

4. They avoid debt

They pay cash, even on big ticket items like cars and houses avoiding thousands, even tens of thousands in interest.

5. They save on the everyday expenses

They are diligent in comparing prices, clipping coupons and scouring Craigslist for deals.

6. They have multiple streams of income.

The have two salaries, live on one and save the other. Or if they are a single income earner they have a side hustle to earn extra cash.

7. They track their spending

In a study of 50 undergraduates, Amar Cheema had students write down every expense for a month. All 50 cut their spending that month by an average of 14%. Six months later, 34 of them were still spending less.

8. They automate saving

They automatically fund 401K, Roth IRA, 529 and savings accounts. They don’t miss the money because they never see it.

I’m pleased that we are doing 7 of the 8 (we currently only have one income) and currently save 32% of our income. But my goal is to get to 50%.

How about you? Do you employ any of these strategies?

Secrets of Super Savers, Donna Rosato, Money, August 2010


  1. I’m in that group by on average saving 60% of my net earnings.

    Picking up on point 5 let me give an example of one method I use. I made a decision that when I next shopped for groceries that I would buy the cheapest of every item available. Some of it was really poor quality but some was also ok. The next time I then bought the good tasting cheap items again but bought the next highest brand of the not so good items. I then continued this process for a few weeks until I found a set of groceries that was suitable but also gave me the lowest price shop each week.

    • Sixty percent! That is awesome!

      Great tip. I always look at generic brands first as they’re typically cheaper and are often the exact same product under a different label.

  2. Super post! It is a great reminder of what works in the real world from the standpoint of savings.

  3. I like this post a lot! Why? Because I feel that I am practicing a lot of those points you listed!

    Especially not accumulating any more debt! (so proud of me:))
    and Delayed gratification. This one is T O U G H !!!

    I am working on the multiple streams of income right now, hopefully something promising will come of it!

  4. I’m doing six of these eight things but really need to figure out how to save a large portion of our income. That’s our biggest hurdle right now. I also need to automate our retirement and ER fund savings. I had automatic withdrawls scheduled these past few months, and that really did help. So, I guess I’m really doing 6 1/2 of these things! Thanks for sharing these facts. It again reminds me of The Millionaire Next Door.

  5. I’m doing
    2 (live below their means),
    3 (delay gratification),
    4 (avoid debt),
    8 (automate) and
    6 (multiple streams of income, to a very small degree)…

    Wow 60% savings rate… and to think, I thought I was going well at 20+%!!!

  6. Here’s another one that I find works (escpecially if you’re single):

    Find a hobby that isn’t expensive to do, or at least try and find ways to make it less expensive. Like, for example, ballroom dancing. Sure, you can pay alot of money on private lessons or you can get a few dvd’s and learn from them. The point is, give yourself something that you can spend your time on, and learn something in the meantime. This way, boredom won’t set in and compel you to go out and spend money on having a ‘good time’. You’ll find if you keep yourself busy, the money stays in your pocket. Woodworking is great because you can earn a few extra bucks with your efforts.

  7. Also, I think, items 2, 4 and 8 above are the MOST important of ones listed. If you automate your savings, you won’t have the money to spend. If you live below your means and can delay gratification, you won’t miss the loss of money to spend. The rest will take care of itself.

  8. I think No. 8, automating everything, is especially important for most things, including retirement savings.

    However, after recently reading about the importance of fulfilling your life dreams (one of mine is traveling) one of David Bach’s book, I have started scheduling automated transfers to a savings account specifically set aside for traveling to my dream destinations.

    The purpose of this is so that I do not use the money for everyday purchases.

  9. I have 7 of the 8 going on. I don’t track spending by any menas. I set up my budget and moved on.

  10. Those are all such simple concepts. If everyone lived by them we’d all be in great shape!

  11. All of these are excellent tips. I prefer living below my means anyway, even if saving money were not a perk; I just try to stay away from excess. If I could get a handle on automated saving and tracking spending, I believe I could save 50% of my income each month.

    Thanks for this post. It’s excellent.

  12. I spend below my means… but there always a things happen that makes me used my money. I also has begin automated saving system, but only able to save around 8-10% monthly. Currently working on having multiple stream of income, but difficult to find one. I guess, I have to live more frugally after this. Reading that some able to save 60% of their pay is awesome and I jealous too.

  13. Great tips on saving. I’ve got a tip not mentioned:
    -Shop at consignment stores. I’ve gone from buying everything and anything at retail price to only buying generic brands at the grocery store or pharmacies and off of sales racks at department stores and online merchants. I’ve donated so much clothes and excess junk that were brand new and in great condition which allowed me the exposure to a great consignment store that allows me to sell stuff I was going to get rid of anyway and make money in return. I can get a check for my earnings from the store’s owner but I get a better bang for my earnings if I spend it at the consignment store itself, which I do, on clothes and shoes other people don’t want. Lucky for me there’s a girl that sells all her things brand new with tags on them, and I usually get them 75%-90% off the original retail price. It’s a great feeling to get new stuff for cheap!!!

    I love tip #8…it works great especially when you setup automatic debt payments. I’ve managed to setup almost all my debts to be paid from my paycheck every two weeks and the great thing is you can setup the payment for any amount so if you can manage to add a little more with no extra effort (such as having to pay the extra amount manually after getting paid), then that saves you even more money, energy and time in the long run.

    Anything I want that’s worth it I save for now. I’ve increased my income by taking on a second job and I’ve even talked with my landlord about lowering my rent in exchange for helping her by babysitting her kids and taking care of her dog when needed.

    Getting creative to save helps you get creative in paying off your debt that much faster. I’ve managed to payoff over 10k of my debt in 2010 and seeing that much reduction has boosted my spirits and motivation. This year’s goal is to setup an automatic emergency fund. It may not be much to start with but like everything else, patience and perseverance will be essential.

  14. Excellent article! We do most of these things and save about 25% of our income. I want to save even more though!


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