Different people have very different attitudes towards money. Some are responsible and know how to be economical, some spend recklessly and can never save, despite not throwing money around still often find themselves penniless, even if they have a decent salary.
No matter why you need to save money, knowing how to is an important life skill, as someday, your savings may save you from some dire situations. But there is rarely a reason why you should always spend your entire income.
What you need is to have a good plan and stick to it. As simple as this sounds, for many, it can be hard, as it will require getting rid of some harmful financial habits. It’s crucial that your plan is as comprehensible and detailed as possible.
You should create a longer-term money-saving plan for yourself, like an easy-to-follow, detailed 6-month savings challenge, which can be your guide through this process.
This way in only 6 months you can become more economical, and have a positive balance or some amount put aside.
Here are some things to consider before you make your money-saving plan.
Stop Spending on Things You Don’t Need
The first advice you will always hear when it comes to saving money is to simply eliminate unnecessary daily or monthly expenses.
For this, you have to determine what are the things on which you spend – whether they are products or services – that, in truth, don’t benefit you. If you can’t think of one immediately, you can keep track of your expenses, and analyze them after some period.
You may be buying too much food that you later throw away, clothes you never wear, books you’ll never read, and a lot of cosmetic products, even though you always end up using the same few things; you may be paying for a gym membership you never use or have unnecessary subscriptions; you may use your car even for small distances, and so on.
Avoiding spending on all or at least some of these will make a huge difference in your balance fast.
Keep Track of Your Spending
Another way to prevent money from slipping out of your hands is to keep a record of your expenses. If you haven’t been doing this it can be the number one reason why you haven’t been able to save.
As we mentioned before, this will allow you to analyze your spending habits and determine where there is a place for improvement.
Keep in mind that if you make this a complicated task, you may easily give up. So instead of trying to record every product separately, you should divide them by categories. For instance, utilities, food, clothes, eating out, and so on.
Don’t Forget the Small Expenses
Even people who are economical and keep at least a rough record of their expenses can ignore the small amounts they spend daily. Things like snacks, coffee, chewing gum, etc. may only cost you little but in the end, they pile up to a significant amount.
Aside from helping you keep a more accurate record of your spending, this can even help you work on living healthier, as well as find other ways to save. For instance, instead of buying coffee on your way to work, you can start preparing it from home.
Put Money Aside
All of your efforts may be in vain if you decrease your spending only to find yourself buying something recklessly at the end of the month with what you saved. This is why the best strategy for saving is to allocate a certain amount of savings.
Ideally, you will be able to do this every day, but realistically, this is difficult to achieve.
A much more effective money-saving strategy is to separate a part of your salary or fee as soon as you collect it, and assign it to your savings. Alternatively, you can choose a weekly amount.
To be able to keep up with your plan to save money fast, you should be realistic about your possibilities. This means that you need to determine a realistic amount that you can set aside using the record you keep of your expenses.
Once you know the amount, you should try not to touch it unless there is a real, inevitable reason.
Conclusion
Working hard all the time, and yet not having any money aside, whether it’s for rainy days, a trip you’ve always dreamed of, or even just for the sake of it, can be truly devastating and discouraging.
Unfortunately, there isn’t a mysterious, secret recipe for saving money. Money will always come and go, and this can’t be stopped. Nevertheless, these steps can help you develop an easy-to-follow plan and start creating your safety net.
[PS: Also read our post on Everything You Need to Know on Salary Paycheck Calculator]