How To Save Money
Let’s get this out here right here in the beginning: no one is inherently bad at saving. There’s no magic gene in your DNA that allows you put away a fraction of your income at will. Your supposed inability to save is most linked with your spending habits and your current priorities.
“But why does it always feel like my wallet has a black hole that sucks up all my money?” you ask.
Well, big spender, I have some news for you, there are reasons why you’re having a hard time saving and it’s not a cosmic region in space that’s making your money disappear. It’s all on you.
For starters, you might not be prioritizing saving at all. Living a life of instant gratification can be bad for your future. If you keep spending all your money in the present, you won’t have any left for the future.
Another reason is that you’re procrastinating. Sure, you won’t be retiring for another 30 to 40 years by why start later when you can start now? Why wait for an emergency before pooling funds for one? Just because something hasn’t happened yet doesn’t mean it won’t happen tomorrow.
Third, and finally, you think an increase in your income means your spending should increase too. News flash: even if you get a salary increase or even if you start selling more in your business, your expenses don’t need to go up as well. Your newfound extra money is better off put away for a rainy day.
Simple Ways You Can Save Money Even if You’re Bad at Saving
While saving can be challenging for a lot of people, it can also be very simple. All you need is a change in mindset. When learning how to save money there are simple thing you can do to start building your savings even if you think you’re bad at it.
Pay Yourself First
Stop promising yourself you’ll start stashing a little money for your savings next month and start doing it now. Think of your savings as a bill you need to pay to your future self.
Every payday, one of the first things you should do is set aside funds for all your bills including your savings. This way, you won’t have any more excuses for not setting aside funds for the future.
Track Your Spending
Effective saving starts with fully knowing how much you spend each month on essentials and non-essentials. List everything you’re spending on each month, including big things like rent and groceries and even small things like coffee, gum, or clothes.
By knowing where your money is going exactly, you can start making adjustments in your spending habit. You’ll be surprised at how much your morning coffee adds up every month.
Set Up a Different Savings Account for Each of Your Goals
Your goals when it comes to how to save money play a key role in your saving journey. Ask yourself what you want to do. Do you want to save up for your retirement? For travel? For starting a new business. Translate these goals into separate savings accounts where you will divide your savings funds every payday.
Automate Your Savings
Take advantage of technology and automate your savings every payday. You can easily set up auto-debit with your bank. This will force you to put funds into your different goal accounts and will prevent you from making any excuses.
Use Micro-Investing Apps
Speaking of technology, you can also try micro-investing apps. If investing in the stock market scares you, then micro-investing is for you. There are apps like Stash and Acorns that let you invest any spare change from your debit or credit card purchases into exchange-traded funds or ETFs.
While you won’t be making millions for this investment platform, it is still a great gateway to investing bigger in the future.
Try a No-Spend Month
Do you find yourself going on an all-out shopping spree every payday only to find yourself struggling to pay for anything else days before your next check comes around? Then it’s probably time to try a no-spend month.
Commit to not buying any new outfits or buying lattes for a month. Don’t purchase any new clothes or shoes, take your lunch to work, and take your coffee instead of buying your usual morning latte.
This not only lets you be mindful and grateful for what you already have but it also lets you save extra money you normally wouldn’t think twice about spending.
Put Your Savings Somewhere You Can’t Touch It
Out of sight, out of mind is the name of the game when it comes to knowing how to save money and building a savings fund for your future. Keep a portion of your savings where you cannot dip into it easily. For example, you can put it in a different bank. Alternatively, you can open a term deposit account and stash your savings there.
Bank Your Bonuses Immediately
When you receive a bonus, don’t hit the mall for a day of shopping. Instead, deposit it immediately to your savings account and forget it ever happened.
Remember that bonuses are not a regular part of your income. Therefore, they’re better off stashed away into your savings fund than spent on something you don’t need at the moment.
Save Your Spare Change
Spare change adds up more significantly than you can imagine. To help you save up, every day when you get home, empty your pockets and set aside coins and any $1 bills you might have and put it in a piggy bank. At the end of the year, you can deposit the contents of your coin bank to your savings account.
Join Rewards Programs
If you have a credit card or if there’s a store you frequent, why not join their rewards program? Typically, these come in the form of cash back for every dollar you spend. Some offer discounts for every point you earn when you purchase.
Saving doesn’t have to be a complicated matter for anyone. For you to learn how to save money all you need is to change the way you look at your money and to be honest with yourself about your spending patterns.
I hope these tips can help you get started on your saving journey.