If you want to buy a house – and not live on ramen noodles in your 60s - you’d better start saving now! In fact, saving while you’re young is critical. For example, if you bank $250 a month in an IRA starting now, in 40 years you’ll have about half a million dollars. But if you wait to save until you’re 45, you’ll have to set aside over a thousand bucks a month to reach that same retirement goal. Also, you should be saving 10% of your paycheck on top of your IRA payments. That way, you’ll have money for fun and can save for a house.  

So, how can you possibly afford to put away that much? Well, if you’re making $40,000 – which is a typical starting salary for a college-educated professional in a big city - you’ll end up with $561 dollars in take-home pay after taxes. So 10% is only $56 dollars. And you easily frittered that away last week on things you can’t even remember. If you simply save that amount instead, you’re nearly set for life. So, here’s how to cut a few corners, courtesy of The New York Times:

  • Make your own coffee. Say you spend $3.50 a day on lattes. Try the free workplace brew instead. In 10 years, you’ll have $11,000 in the bank.  
  • Learn to cook. A twice-a-week habit of pizza or Chinese takeout could easily cost you $10,000 in 10 years.  
  • Bown-bagging your lunch could save you about $23,000 a decade.
  • If you’re a smoker, quit now. You’ll save about $25,000 over a decade, and add years to your life, as well.
  • Total savings from just coffee, cooking, lunches and cigarettes over 10 years: $69,000! Enough to put a down payment on a house.
  • Every time you get a raise, pretend you didn’t – and bank all of it.