Having money enables you to take advantage of situations according to your wish and needs. But if you do not have extra money you won’t be able to do what you want, whether it is a college admission, starting a new business, or investing in shares. If you have money saved you don’t have to worry about expenses in times of need such as an accident or for medical treatment.
1. Record Your Expenses
Keeping a record of your expenses is the first step to saving your money. This means taking even minute details of expenses into accounts such as buying little things like a coffee mug or household items and cash tips you might give. Once you start tracking your every expenditure, you will know that you don’t have to spend on unnecessary things.
2. Make a budget for savings
Once you make a list of things you spend your monthly income on, you can easily organize your expenses into a budget. Make categories of expenses like monthly bills and groceries and carve out a fixed amount of budget based on those. Make sure to include expenses that may occur regularly but not monthly such as car maintenance. Make a savings category as well and aim to save up to 10-15% of your monthly income.
3. Find ways to cut your expenses
If your expenses are high such that you are not able to save as much every month, then know that it is time to cut back on your spending spree.
Here are some ideas you might like to help trim down your expenses:
- Use your financial resources such as community events to find low-cost events to help reduce entertainment expenses.
- For medical expenses such as buying medicines, choose pharmacies that offer discounted prices such as https://www.pricepropharmacy.com/, so you don’t have to burn a hole in your pockets for your prescription medications.
- Cancel any subscriptions or services you don’t use much especially ones that renew automatically.
- Try to eat out only once or twice a month and choose places that offer food at cheap rates.
- When you feel tempted by a non-essential purchase, give yourself a “cooling-off time” and wait a few days. You may pass the temptation or save up for it.
4. Set Realistic Goals
Setting goals save you a lot of money. Find a cause first and start saving up for it. The goal can be anything from saving up for marriage to planning a vacation or buying a house. Then calculate how much money you need to save and how long would it take to reach up that goal. Consider a 10-10-10 rule for savings which implies that you think before spending money that will it matter after 10 minutes, 10 months, or 10 years? This will save you a lot of money.
5. Make your savings automatic
Make separate savings account for depositing your savings. As soon as you get your salary, deposit a percentage in your savings account. You will be surprised to see how much you will save after a few months.