Suze Orman says this is the $1-$2 mistake that can ‘creep into’ too many of your financial decisions — and it could cost you tens of thousands of dollars

Saving a dollar or two here and there may seem trivial, but finance guru Suze Orman says these small amounts aren’t as insignificant as they may seem when you’re trying to build financial security during tough times. Indeed, she recommends asking yourself one question: “Are your needs as inexpensive as possible?”

Orman says even the little things add up. “You’re at the grocery store and pick up the more expensive brand and tell yourself it’s just $1 or $2 more and you deserve it. I agree, you do deserve it. But if you stand in your truth, do you need it? That $1 or $2 per item can add up to $20 or more per shopping trip. Over the course of a month, or a year, that can add up to significant savings that could go toward paying down debt and saving,” says Orman. (And good news on the savings front: Many high-yield savings accounts are paying more than they have in 15 years; see the highest rates you may get on savings accounts here.) 

We asked pros: Do these little amounts really matter?  Some pros say yes. “If you add up the savings of repeatedly looking for opportunities to reduce costs on a weekly or monthly basis, those small amounts can add up to a considerable amount,” says certified financial planner Bruce Primeau at Summit Wealth Advocates.

The numbers bear this out. Let’s say you sock away roughly $2 each day — and at the end of each month invest $60. If you invest that money, and get a 6% interest rate, in 30 years, you will have more than $56,000. Not too shabby. See the highest rates you may get on savings accounts here.

Of course, this idea of little things adding up isn’t a new thought (financial guru David Bach with his “latte factor” have been saying this too), but with some predicting a recession coming, it feels relevant to bring this back up. So how exactly do you start down the path of saving these small amounts? 

Certified financial planner Chris Diodato at WELLth says he loves round up programs that put small amounts into an investment or savings account each time you make a purchase. “Acorns is the best known app for investing spare change, while Bank of America and Chime both have easy-to-use programs to build up your savings,” says Diodato.

Automating as much of your savings as possible is helpful, pros say. “Out of sight, out of mind (like directing a portion of each paycheck into a separate savings account), can be a good way to save money without needing to do anything or feeling like you’re missing out. Beyond that, look for ways to prioritize what really matters to you,” says Ted Rossman, senior industry analyst at Bankrate.

This means, taking a look at the money leaks in your budget. “Things we do or subscribe to or otherwise spend money on that aren’t particularly meaningful are good things to cut first. Whether it’s the happy hour that you go to more out of perceived obligation than true desire or overlapping streaming subscriptions or excessive Uber rides or restaurant meals,” says Rossman. 

Aside from becoming a more conscious spender, there are other behaviors you can change to save money. “Save money out of every paycheck. Start with 1% of your income, direct deposited into a savings account with every paycheck. After you get used to that, try increasing it by 1% until you’re saving as much as you can. Work toward a goal of savings 12% to 15% of your gross income,” says Kenneth Robinson, certified financial planner at Practical Financial Planning. See the highest rates you may get on savings accounts here.

Like Orman’s recommendation of saving very small amounts, Robinson says if 1% increments are too large, start by saving $5, not $50. “Then increase your savings $5 at a time. After you’re used to saving money from each paycheck, then it’s time to consider a tax-advantaged approach like your employer’s 401(k) or a Roth IRA,” says Robinson. 

Sometimes, funneling money into savings can happen more naturally. Young adults, like those who may be burdened by paying down student loans, can take advantage of a savings opportunity once their debt is paid off and they can put those monies into savings. “I like to think the best measure of how much savings you should have factors in your expenses. It’s important for people to consider savings goals that may be separate from emergency savings. Someone who aspires to buy a house within the next year or two should consider opening a separate savings account for that home down payment,” says Rossman.

How much should you have in savings? 

Even amid an inflationary environment like the one we’re currently experiencing, experts recommend having an emergency savings account of anywhere from 3 to 12 months. “People should try to build a larger cash reserve or emergency fund during tough economic times. It’s easier said than done, but if the economy slips into a recession, job losses could start and the value of having an emergency fund will be immense,” says Diodato. See the highest rates you may get on savings accounts here.

That said, how much you need depends on a lot of factors, including your family situation, career, whether or not you own a home and more. “Someone in their 20s without a spouse or kids who rents and rides public transportation probably has very different savings needs from someone in their 30s or 40s with two kids and a stay-at-home spouse, 2 car payments and a mortgage,” says Rossman. 

And pros say, start saving as early as you can, and keep increasing how much you save. “Many may dismiss their 20s, but this is an exciting time to start your financial journey on strong footing. If you’re not thinking about your retirement savings in your 30s or 40s, refocus because this is when you’re more established in your career and can make a stronger impact in your financial future. In your mid- and later years, you may need to be more strategic to make up for lost time if you don’t have a solid foundation,” says Gabe Krajicek, ceo of Kasasa, a fintech that provides community banks with financial products.