For what it’s worth, money can be pretty difficult to save. People find it easier to squeeze every last penny out of their budget. As long as they have the money, they don’t mind spending it on anything even when they don’t need it. Whether you belong to this class or not, learning how to save money will make your life a whole lot easier. It can make the difference between living a life of financial freedom or one that is laden with debts.
Sometimes, it’s not really how much you earn that makes you rich, but how much you spend and save. If your expenditure always closely equals your income, then you are more likely to be in need most of the time, even if you earn millions annually. You will never become rich that way!
Thankfully, unlike investing, you don’t need a degree or any special training to be able to save. All that is required is your resolution and commitment to spend only when you need to. It doesn’t matter how much you earn or how old you are, you can become a savvy in almost everything you do that involves money, especially shopping.
With this in mind, here are five simple tips you can apply every day to start saving money.
Have a Clear Picture of the kind of Lifestyle You Want
You may have a dream of owning your own home, buying a new car, or having something to fall back on after retirement. Saving can make it happen. How?
Define your goal and think about the lifestyle you would be able to have by saving towards that goal. This will help you stay motivated and also make it easier for you to cut down on certain expenses in order to achieve your dream.
Stop carrying your credit cards around
One of the easiest ways to avoid “impulse purchases” is to leave your credit card in the house when going out.
Whether you wish to eat out or shop for some items, make sure you carry only as much cash as you need. Don’t carry your credit card along or you may be tempted to bust your budget.
Buying from the store should be your last option
When getting something from a store, make sure you’ve exhausted other options before buying. Try to find out if there are other ways of obtaining that thing without necessarily buying it.
Is it something you can get for free? On sites like Craigslist, you may find someone who wants to get rid of the same thing you need. Or if you are a gamer, you may want to consider using sites that offer free slots no download.
When the item is not available for free, you may consider borrowing especially if it’s something you won’t be using all the time. For instance, if you need a drill for a simple installation work, you can either borrow from a neighbour or friend, or you can rent it from any home improvement store close by.
Create a budget and record your expenses
An understanding of how much you spend every month will enable you see where you need to make adjustments. After recording your expenses as well as possible contingencies, you can now develop a budget.
Make sure, your budget is within the limit of your income. Ideally, it should be lesser so that you can have something to save.
Automate your saving if possible
Open a saving account if you have none and have your bank automate transfers to the account. So as your income is coming in every month, a certain percentage is shifted to your saving account.
This will help you save your goal without thinking so much about it. And since the money isn’t with you, there’s very little chance of spending it.