No one is born with mastery of money. For many, penny-pinching parents or the harsh realities of independently living were enough to teach them to watch every dollar and make saving a priority. For most of us, however, it can be difficult to reign in the spending, even when we want to reach important savings goals, like building up a down payment for a house or saving enough money to retire at age 67.

If you’ve struggled to keep your budget balanced, stay out of debt, or set aside money for an important life goal (or even a rainy day), you’re in good company. In fact, though it takes nearly $900,000 to retire in comfort in Illinois, the average retirement savings in our state is only half that.

While there are many factors that dictate an individual’s ability to save that are out of our control, there is one step that we can take to change: our spending patterns. In this post, we’ll provide our best tips for how to initiate behavioral changes that can break the habit of overspending, creating a habit of routine savings in its place.

Setting clear, SMART financial goals boosts motivation, tracks progress, and enhances financial literacy for successful savings.

Understand Spending Habits

Before you can save, you need to understand where your money goes. The best way to do this is to track your expenses for a month, categorize them, and identify where you might be overspending.

Because much of our spending is done using debit cards, credit cards, and automatic payments, it can be easy to analyze it using account statements as well as free digital money management tools provided by your financial institution—often found in their online portal or mobile app. There may be some numbers that surprise you, like takeout, gas, or clothing purchases. Look carefully for places where you spend more than you need to. By recognizing these patterns, you can make informed decisions about where to cut back.

Understanding your habits can also reveal hidden costs you never considered—like autopay subscriptions or even a daily coffee from your favorite drive-thru. Small expenses can add up, too, and cutting a handful of small costs may even save you more than trimming back one major expense.

Set Clear Financial Goals

Having a clear vision of what you want or how you want to improve your life financially can be a major motivator for you to save. Whether it’s buying a home or a car, or saving for retirement, selecting a goal and envisioning the account can be all the incentive you need to kick some bad spending habits and stick to a budget.

Goals not only give direction to your saving efforts and provide a sense of purpose, they also offer a measurable target, allowing you to track your progress and celebrate milestones. When setting goals, use the SMART acronym to help you create more incentivized and actionable outcomes: Specific, Measurable, Achievable, Relevant, Time-Bound.

Select a Type of Budgeting that Works for You

Using a budget serves two purposes: It helps you teach yourself to focus on your spending habits, and when you stick to it, you can spend less money, creating added room for savings. There are dozens of budgeting methods out there, and you might have to try a few different kinds before you find the one that works for you. Common approaches to budgeting include:

  • The 50/30/20 method. This type of budget is a simple formulation where you allot 50% of your income to needs, 30% to wants, and 20% to savings. You can use an app or keep track of your spending yourself using receipts and account statements. You may need to play with the numbers a little to match your needs. For instance, if you have an exceptionally tight budget, it may be hard to swing 20% for savings, or you may find that spending 30% on wants is more than necessary, and those extra funds could be better used to boost your savings.
  • Budget envelope stuffing. One of the oldest budgeting hacks, with this method, you have a set dollar amount of money that you allocate for your expenses and wants. Each month, you put that amount of money—in cash!—in each designated envelope, forcing yourself to limit your spending. For individuals who are concerned with the security of a cash system, you may choose to simply use cash for discretionary spending—and when it’s gone, it’s gone! You may also consider using modern versions of this system, found in popular budgeting apps…
  • Perhaps the easiest way to budget today is to utilize a budgeting app. Popular and trusted recommendations include apps like Simplifi and YNAB (You Need a Budget). While neither option is free, consider them as training wheels; they can integrate seamlessly with your bank account, help you track spending, show you dollar-by-dollar how much you’ve spent and have left to spend in your budget and train yourself to spend less. When you’ve got the hang of your budget, there’s no rule that says you need to keep subscribing!


The 30-day rule curbs impulse spending by distinguishing between 'wants' and 'needs', promoting thoughtful purchases and financial prudence.

Embrace the 30-Day Rule

Even with a firm budget in place, impulse buys can quickly drain your wallet. While many small items can add up, one big budget-busting purchase can throw off your entire savings plan.

The 30-Day Rule suggests waiting 30 days before making a significant purchase, whether it’s on the smaller end—like a new pair of expensive shoes—or the larger end, like a new electronic device. Often, after a month, the urge to buy diminishes, saving you from unnecessary expenses. At the very least, go home, think about it, and give yourself a few days to consider your needs, and options, and conduct a little bit of research.

Putting time between the impulse for an item and its actual purchase also affords you the space to reflect on the true value and necessity of the item, creating a buffer against the draw of instant gratification and helping you distinguish between ‘wants’ and ‘needs’.

Automating Savings

One of the ways that companies get us to depart from our hard-earned money is automation: automatic subscription renewals, automatic billpay, and easy, pain-free payment systems at stores. While as consumers, we embrace these things for their convenience, they don’t necessarily work well for getting us to spend less. But there is one way that automation can help, and that’s when you automate savings.

Whether you set up automatic transfers from your checking to your savings account or have a portion of your paycheck directly deposited into a designated savings account, taking that extra step out of fulfilling your savings plan can make all the difference for individuals with busy lives. Automating savings can:

  • Ensure some of your income goes straight to savings before you even see it.
  • Reduce your temptation to spend through an “out of sight, out of mind” approach.
  • Guarantee a consistent level of savings each month or paycheck.
  • Instill a “pay yourself first” mindset, underscoring saving as a fundamental aspect of money management.

Over time, these automated contributions can compound, leading to substantial growth in your savings. With a variety of Savings Accounts to choose from at Flanagan State Bank, you can find one that meets your needs while maximizing earned interest.

Being a savvy shopper means maximizing value through research, embracing deals, and prioritizing quality over quantity for long-term savings.

Shop Smart

Being a savvy shopper doesn’t mean depriving yourself. It means looking for deals, comparing prices, and avoiding buying things you don’t need. Over time, these small savings can add up significantly. Here are a few ways to shop smart:

Maximize discounts. Embracing coupons, cashback offers, and seasonal sales can lead to considerable discounts—as long as you are only buying things you would have bought anyway.

Do your research. Being a conscious consumer by researching products before purchasing ensures you get value for your money. It can also help you avoid purchasing products that lack longevity, causing you to waste money. In addition to researching products, research alternative solutions, including repairs and more affordable options.

Consider quality over quantity. Fast fashion and cheap goods may save money upfront, but, as we mentioned above, often can cost you more in the long run when you factor in replacement costs. Paying a little more for items that you need that will last a long time not only saves money, it reduces the stresses of dealing with poor-quality goods    while minimizing waste.

Surround Yourself with Financially-Savvy Friends

Your circle of friends can influence your spending habits, and surrounding yourself with financially responsible individuals can inspire you to adopt similar habits. And if you don’t want to ditch your friends, consider working with them to create a group goal of better money management.

Ways friends can help each other reach their financial goals include:

  • Sharing saving tips.
  • Making a habit of discussing financial goals.
  • Motivating each other to stay on track and celebrating each other’s successes.
  • Strategizing to make more affordable plans for going out, going on vacations, or other activities you do as a group.
  • Creating a network to facilitate borrowing—instead of buying—expensive but seldom-used items.

Peer influence can be a powerful motivator, and when you see friends making wise financial decisions, it encourages you to do the same. When you engage in healthy financial discussions, it can lead to collective growth and shared success. On the other hand, spending time with individuals who make expensive lifestyle choices can have a negative impact on your own financial stability. Choose your friends wisely and take the time to consider how the individuals around you affect your own financial habits.

Embark on your savings journey with Flanagan State Bank, your trusted guide across El Paso to Bloomington, ensuring disciplined growth and tailored financial situations.

Reach Your Savings Goals with Flanagan State Bank

The dedicated team at Flanagan State Bank is here to help. We can work with you to discuss your goals, brainstorm strategies to reduce your spending and debt and find the right products to accelerate your saving.

From El Paso to Bloomington, Benson to Le Roy, and Gridley, and in between, the journey from spender to saver is one filled with learning, discipline, and growth. Why wait? Start your saving journey today, and let Flanagan State Bank be your trusted guide.



Q: How can I save money?

A: Start by creating a budget to track your income and expenses. Cut unnecessary expenses, shop smartly, take advantage of discounts and deals, and set aside a portion of your income regularly into a savings account.

Q: What is the best way to invest money?

A: The best investment depends on your financial goals and risk tolerance. Common options include stocks, bonds, real estate, and mutual funds. It’s advisable to diversify investments and consult with a financial advisor to make informed decisions.

Q: How do I create a budget?

A: List all sources of income, categorize and list monthly expenses, set spending limits for each category, track and compare actual spending to your budget, and adjust as necessary.

Q: How can I reduce my debt?

A: Prioritize paying off high-interest debts first, create a budget to allocate more money towards debt repayment, consider debt consolidation options, and avoid accumulating more debt.

Q: What are the benefits of having a savings account?

A: A savings account offers a safe place to store money, earns interest, helps in emergency fund accumulation, and promotes financial discipline.

Q: Is it better to save money or invest it?

A: Both have their place. Saving provides liquidity and is suitable for short-term goals while investing can offer higher returns over the long term but comes with more risk. Diversifying between saving and investing may be the best approach.