Do you ever wonder what happens to all of your money? Even if you have a household budget and keep a reasonable eye on where your dollars are going many people reach the end of the month wondering what happened to all the “extra” they thought they should have. It is not enough to have a budget and general idea where your money is going each day. In order to truly reach financial security you must have healthy saving and spending habits as part of your daily routine. Here are few places those missing dollars could go to save you even more money in the future.

• Pay more than the minimum- This advice is commonly found when looking for ways to pay down your high interest debt. While this is definitely true you should also consider paying more than the required amount on your mortgage or home equity loans. Unless you will face a prepayment penalty paying more on your principal can save you thousands of dollars on the life of your loan.
• Continue making payments after your debt is paid off- Not to the lender of course, you should continue making payments to yourself instead. If you do not have a “place” for that extra money to go each month it will likely get absorbed into your day to day living expenses. Instead you can redirect those payments to your savings account without missing the money since you are not used to having it in the first place.
• Review your bills- Automated payments offer the convenience of not having to pay attention to when or to whom your bills are paid, however many people become lax in actually reviewing their bills. It is important to read your bill each month not only to check for inaccuracies but to also “see” how much you are spending. You may be able to implement small changes in your daily habits that can reduce your electric, heating or water bills.
• Automate your savings- Instead of relying on your own memory and will power to get your savings into your account each pay day sign up for direct deposit and have your savings automatically deposited into your account. This will reduce the chances of you “finding” other things to spend the money on by eliminating the need for you to handle the transaction.
• Take advantage of employer offered retirement plans- Similar to automated savings when you have your retirement contribution directly withdrawn from your pay check you not only reap the tax benefits you might also benefit from “free” money if your employer offers to match your contribution.