Have you ever ask what the effective strategies to save money are? Every year the three first New Year’s resolution, I always hear are to lose weight, quit smoking, and to start saving money.
Do you know that the most challenging resolution to do is to save money? Most of the teenagers and young professionals do not practice saving money even if they want to practice savings.
Top reasons why it is difficult to save money
- You are a FOMO! FOMO means Fear Of Missing Out the trend.
- You don’t know where your money is going.
- Your goals of why you want to save money are not attainable.
- You might be the envy of what others have.
- Saving money is difficult. Unless, you got the right mindset, saving money will become smooth and will be part of your lifestyle
- Saving money is a habit.
- Debt will prevent you from saving money
- When you save money, you will change your lifestyle
- It is not true that you cannot avoid if you receive a low pay
Practical strategies to save money
I have been working for almost 18 years. But, I cannot say that I was able to keep what earned for the years that I have been working. In fact, I have a good job and earning from my other business. I have a good drawing, but I have not saved any amount in my bank account.
A few months ago, I was able to learn from one of the YouTube videos of Chink Positive some ways to save my money. Thus, The tips that I am going to share with you are from my personal experience. I have been successful in these strategies and able to save some of my monthly earning
Years ago, I did not believe that this practice will help me save some money. I feel awkward if I write what I spend and what I earn. However, I learn that those feelings just come from my pride. The truth is, I am too coward to face my weaknesses over money.
Last 2018, I started to practice writing down what I earn and spend in a small notepad. My colleagues are even laughing at me. Honestly, it is not that easy. There is the time I forgot to write and avoid to write those amounts. However, as the month’s passes by, it became a habit for me.
Writing your earning and expenses is a way of teaching yourself to develop the habit of giving the value of money. You will learn to identify the “needs” and “wants.” Consequently, practising the accounting of your expenses and income is the start of the necessary skills of saving money. You will be starting to train your brain and emotions.
2. Plan on saving money
Before, when I plan to save money, I put them into my notebook, my journal, and notes of my smartphone. It doesn’t work effectively. I tend to forget because I am overwhelmed by gadgets, food, and travels that motivate me to spend what I have in my pocket.
Finally, I found the best way to make a plan to save money. I set a SMART plan. My plan is I want to save money because I want to buy at least a second-hand car by December 2019. Setting a clear and measurable target helps me get the motivation to allocate a percentage of what I earn to my piggy bank.
It is essential to set a minimum figure to save. I usually set at least 5% of my weekly income. However, because I am motivated, I save more than my target. The best way to start the strategies to save money is to start planning
3. Make a budget
Making a budget is easy. However, implementing what is in the budget is hard.
However, I was able to get out of this budgeting struggle. When I started to learn to track and writing my expenses and setting my mind to my reason why I am saving money, making a budget becomes a habit to me. The budget plan is my tool in monitoring my expenses.
Prioritization becomes challenging when you see the term “SALE” in the mall.
My office is just a few meters from the Shoe Mart (SM) Mall. Every day I get to pass the mall. The 50% off, 20% off is satisfying taste to see. Every boutique is like shouting and calling my name. However, how did I get to relieve myself from these temptations?
Honestly, it is not easy to get away with “SALE.” The habit of starting to be conscious of my spending, budget planning, and focusing on my ultimate purpose why I want to save money helps me to learn how to prioritize.
Prioritization merely knows what my “WANTS” and “NEEDS are.” Whenever I am in a store offering a 30% discount on my favourite brand of shoes, I will start to ask myself these questions:
- Is buying and wearing brand new shoes an urgent necessity?
- What’s up with me if I buy this new pair of shoes?
- How much will I lost towards achieving my goals of saving money if I buy this new pair of shoes?
- Is buying this shoes a WANT or a necessity?
Hence, I become impulsive in buying things because I let my emotions overcome my mind to think and decide. It is never easy, and yet I learned to control my feelings so that I will not make decisions out of my emotions.
5. Choose the money-saving platform that fits your comfort
There are so many ways to keep your money safe:
- Choose a bank, open an account, and deposit your money. It will grow from 0.10%- 0.25% per annum
- Piggy bank. It looks old school, but it works if you want to train your mindset. I am putting money in my piggy bank. Every time I receive my earning, I am always motivated to put bills and coins in my piggy bank.
- Invest in mutual funds. Several fund managers accept mutual funds for as low as $20. You can add more to the amount every month. I have some of my pennies invested to at least two mutual fund managing firms.
- Save money through life insurance with a package of savings with good compounding You can contact trusted agents that will be eager to educate and help you.
Saving money is essential in our lives. Do not ignore the opportunity to learn effective strategies to save money. Learn and start to save now while still, you can. Do not wait for the time that you are sickly and nowhere to run to find the money that can suffice your needs.