Money doesn’t grow on trees. Here are simple tips to save money. It grows from hard work and saving. We all wish we could save more money, because life’s little twists and turns are nothing if not costly. Broken down car? Faulty kitchen appliances? Birthday gifts for loved ones? Trying indoor climbing with friends? Thinking of getting a new pet? Broken a mug and now you need a new set? Things cost money. The more we can save, the less likely these things are going to affect us too much.
If you want to sort out your finances, try this useful calculator from Creditfix. Below, we’ve listed some top tips on how to save.
Creating a budget is easier than you think
If you haven’t heard of the 50 / 30 / 20 rules by now, it’s time you caught up. In essence, this rule is designed to give savers something to aim for in terms of how much to spend on bills (50%), how much to spend on necessary things like groceries (30%), and how much to save (20%). Now, if you’re reading this thinking you spend more than half of your income on bills, that’s OK. These are only guidelines. The point is that if you are currently spending 60% of your income on bills, for example, try not to get into any further debt.
Set up automatic savings
Savings accounts are easy to set up. The problem is that all of us can, at any time, open our banking apps and transfer our savings right back into our bank account at any time. The issue isn’t in promoting the usefulness of setting up automatic savings, the issue is being mentally prepared for those savings not to be part of your monthly emergency fund for takeaways and other treats. You must learn to save long term, not just for three days. And in that regard, you need a plan…
If you’ve ever watched the marathons runners mid-race on TV, you’ll have noticed that each runner has a habit of checking their wrist-watch. They’re not checking to see if it’s nearly dinner time. They’re checking their speed and distance, so that they know whether they are on track to achieve their PB (personal best). In the same way, you need milestones, because blind savings feel pointless and as if you’re limiting your disposable cash for no reason.
Saving for a trip abroad? You can measure your monthly savings to reach the savings target. Savings for a car? Same thing. No matter if it’s a new house or a new phone, knowing what you’re saving for will help you stay on track.
Look into consolidating your debt
Multiple monthly payments on credit cards and loans can hinder your ability to save money. Look into a single credit card or loan payment that consolidates your debt – these payments may mean taking on more debt over a longer period, but will often result in one single lower monthly payment. It’s up to you, and depends on whether you really want to save for something special, but this could be an option to help you to save more money over a shorter period of time.