How to Save Cash Without Feeling the Pinch

If you're living from paycheck to paycheck, the thought of saving any amount of money seems like a fantasy. But, if you have children that you hope to send to college or are planning for your own retirement someday, saving now--and saving as much as you can--is the only way you'll get to those dreams. Beginning a savings doesn't have to dramatically affect your lifestyle.

Instructions

Difficulty: Moderately Easy

1. Stash away pretax earnings through a "Dependent Care Account" through your work. Many companies allow workers to deduct up to $5,000 in pretax dollars from their paycheck and use the money to cover childcare expenses such as day camp, preschool and after-school care. Once you get reimbursed for your eligible expenses, deposit the check (or the portion of it you don't need to pay bills) into a 529 college plan.
2. Reallocate childcare expenses and preschool tuition to a college savings account when your child starts elementary school. When your child goes to public kindergarten, these fixed expenses will go away, and you can stash most of it into a college savings account, but make sure you're funding your retirement first.
3. Use "rewards" credit cards. Get a card that gives you a "point" for every dollar you spend. Rather than redeeming them for prizes, take the cash back for your child's education or your retirement fund.
   
   You can also use a credit card that's affiliated with a so-called "affinity program" that contributes money toward a college fund when you buy qualifying products at participating stores.
4. Bank your coins. If you spend only bills and put all your change in a jar, you'll save up to $400 a year.
5. Ask grandparents to help with college funds. Have a discussion with your parents and in-laws about the cost of college. Suggest to them that they reduce the number of presents they give your child and instead deposit some of the money into his/her college account. Your child won't miss one stuffed animal or DVD on their birthday, but cash contributions over a 10 to 15-year time period, regardless of how small, can really add up.