Everyone has short term and long term goals but might not have the savings to reach the goal.
There are various factors that deviate you from reaching the goal like understanding that there is a difference between need and want, impulsive buying, FOMO, etc.
It is very important and crucial to know the difference between need and want. Need is something that you can’t do without and want is something that you buy to satisfy your heart or mind. You don’t really need them.
Impulsive buying is when you get a strong urge of buying unnecessary stuff while surfing your favorite apparel brand and checking out the huge discount on various items.
They hurt your budget and set expenses for the month and you lose out on saving for your favorite, which you have always wanted.
FOMO(Fear Of Missing Out) is another important factor that drags you in the opposite direction. People buy stuff just because their friends are buying them. They have that constant fear that they might lose out on something important if they won’t buy it.
So, when it comes to saving, first of all, It is very important to initiate. Getting started is the first step that many people feel is very difficult.
I am going to tell you where & how to start.
You will not be losing your hard-earned money but will be able to save it by controlling yourself or splitting it.
Below are the seven ways that will help you start saving right now.
Follow 30-day rule
The 30-day rule is a strategy that helps you control your spending by waiting for 30 days to buy any product.
It is applicable for any nonessential product that you wanted to buy, the rule says stop, don’t buy, instead note down the date, price, and place where the product is available. Check again after 30 days and decide whether you still want to buy it? Is it still necessary?
The time frame actually helps you decide and make a wise decision. Sometimes it so happens that the product wasn’t really necessary and you will save money.
2. Track your Expenses
It is a good practice to record all your expenses such as the amount spent on coffee meetings, household expenses, utility bills, etc. This will give you an idea of your average monthly expenditure on various things.
Also, you can match it up with your bank statement to know the expenses are accurate and correct.
3. Spend as per your budget
Starting the month with a budget allocated for various expenses will help you spend only on the things that are really required.
It will limit your overspending since the budget will be already decided.
However, there will be few items that don’t need attention every month but need to be checked regularly such as vehicle maintenance. You must allocate a budget for this type of expense too.
4. Figure out ways to cut back your spending
When your spending is really high and you are wondering how to save, check for your expenses on subscriptions that get auto-renewed every month and you don’t really use the services. Cancel all those memberships and subscriptions.
For entertainment expenses, you can refer to the event listing websites that offer low-cost entertainment options.
Eating home-cooked meals more often are a healthy and economical option.
5. Set a goal for saving money
People want to save for a variety of things. Setting a goal beforehand will drive you to spend less and save more. Decide what you want to save for. There could be two types of goals, short-term, and long-term goals.
A short-term goal could be saving for an emergency, downpayment for a car, or saving for a trip.
Long term goals could be the downpayment for a home, starting a business, or arranging for higher studies of children.
6. Use cash instead of credit
Credit cards just ease the process of overspending because you don’t really feel the money going out whereas if it is cash you can feel it going out of your hands. Also, credit allows you to buy even if you have no money in hand and leads to unnecessary spending.
7. Auto transfer to the savings account
Transferring a portion of your salary to the savings account or applying for an automated transfer is a good strategy to save. This doesn’t need a lot of effort or thinking as your money will be with you only but in a different account. This will limit your expenses as you will want to spend only up to the limit you have in your current account.
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