Have you been finding it difficult to save money or you care to save more money ?
9 tips for saving money. If yes, that problem is solved already because when you are done reading this, you will find saving money very easy if you follow the tips. People wonder how they spend all their money without having a savings and later borrow money from family and friends. Many times the hardest and most important thing about saving money is just getting started. Once you start Saving money then you a step towards achieving your goal. These following tips on how to save money can help you develop a simple, direct and realistic strategy which will greatly be of help, so you can save to achieve your savings goal either it is a long term goal or short term.
Tips for saving Money #1. Record your expenses:
As it is a fact that savings is dependent on expenses and Income. The first step to start saving money is to figure out how much you spend and your pattern of spending. Knowing how much you spend and the pattern of spending will make you identify your spending on necessity and luxury. It will help you know when you spend most, is your most expense on food or clothing. You can record your expenses by checking your cash transactions over time, compare and see the reoccurring expenses and other types of expenses.
Tips for saving Money #2. Cut spending and budget for saving:
The biggest mistake you will ever make when saving is to save after spending, you will be shocked that you might have literarily nothing to save, you must always save first which should always appear in your budget just like other expenses, you can always automate your savings through your bank account as most banks runs automated savings which you just have to give them a go ahead. In order to have more to save even when your income is still the same , then you must cut down some expenses like unnecessary spending, buying your stuff in bulk will reduce the unit price, so it’s advisable to buy your non perishable consumer goods in bulk or share cat with friends when you need lower quantity.
Tips for saving Money #3. Set a savings goal:
Setting a savings goal will drive you to achieve it. Many people quit savings at some point because they don’t have a goal set. Assuming your goal is $1 100,000 dollars for a new house and you have an automated savings of $5,000 per month, your goal of buying a new house with the savings will not make you quit.
4. Build A $500+ Emergency Fund:
Research showed that Low-income families with $500 or more as an emergency fund were less likely to experience financial and psychological problems than moderate-income families with less than $500?
There are many benefits to having an emergency fund, which you can use to help pay for the all-too-common unplanned expense. You bounce on the emergency fund instead of borrowing at an interest rate. This will save you the interest and help save more money.
5. Focus On Housing, Transportation And Education:
Did You Know: TD Ameritrade did a study to try to figure out how some households are able to save 20% or more of their income. It turns out, the single biggest factor is how much they spend on housing. The Super Savers, as the study calls them, spend just 14% of their income on housing while the average household spends 23%. Not only are houses, cars and education the largest line items in your budget, they’re often financed with debt which you have to pay back with interest.
6. Eliminate Your Debt:
If you are trying to save money through budgeting and automated saving but still carrying a large debt burden, start with the debt. When you have a debt burden, you pay interest on the debt which should have gone a way into your savings. If you are still doubting how this is really affecting you let’s assume Mr. John have a loan debt of $25,000 dollars at an interest rate of 8.8% per annum and he decides to pay his debt in 5 years, the total interest on the loan is $11,000 and resulting total amount debt of $36,000 which results in $600 monthly debt payment. Instead of Mr. Ade saving $400 per month he will save himself some about #5,500 dollars if he could pay up his debt first with everything by paying in 2 years and 7 months at the rate #1,000 per month.
7. Pack Your Lunch:
Consider the facts. The cost of eating out is $11 per meal on average, whereas preparing your own lunch costs around $6.30 per meal. Over the course of a year, you could save $1,222 if instead of eating out for lunch each day, you began packing your lunch. An obvious and Crystal clear money-saving tip is finding everyday savings. If buying lunch at work costs $7, but bringing lunch from home costs only $2, then over the course of a year, you can create a savings of $1325 from your lunch which can go into your total yearly savings.
8. Cut down luxury goods:
It is not a news that luxury eat deep into ones income and reduces savings. Instead of buying a luxury car of $50,000 why not buy a cheaper car of $10,000 with comparable value which is not a luxury car or use buses or board trains. Citing your luxury spending will increase your savings in a rapid was. Why will you buy a luxury sandal of $1,000 when you can get a good quality sandal for just $100, this will help you cut your expenses by $900 which can go into your total savings for the year.
9. Set up a separate savings account:
Creating a different savings account which linked to your normal spending account and makes you save more. An online savings account is a great way to manage your money. Unlike a transaction account, you can’t spend money directly from a savings account, so it’s harder to dip into your savings. Look for an account with the highest interest rate and no or extremely low fees, this will help grow your savings with time.
These tips above are great tips to save more which have been confirmed by some researches. If you put the above guide into use then you should be able to maximize your savings and achieve your goals.