Being able to save money is the very first step you need to take if you want to improve your financial situation. Here are five saving tips you shouldn’t miss out on!
1. Keep track of your money
Among the different saving tips, this is the most important. No matter how good you think you are at keeping track of things mentally, you still need to list down your savings and expenses somewhere. Often times people who don’t keep track of their money tend to overestimate their financial standing. Furthermore, these are the people who are usually unable to save. Since expenses aren’t being tracked, they can often eat away at the money supposedly set aside for savings.
By regularly monitoring your savings and expenses, you’ll be more aware of how you currently stand financially. In fact, this will also help you better understand your own money habits. You’ll be able to figure out why you usually spend more than you should, and how you can make an adjustment. Always remember that you can’t improve what you don’t keep track of.
2. Start even with just a small amount
Starting to save even with a small amount at first can have a big impact. Of the different saving tips, this can be one of the easiest to start. It can help you establish the habit of saving and can let you become more responsible financially. When you make the conscious effort to save even a small portion, you begin to develop financial discipline. The amount might be small at first, but as time goes on the discipline you gain will help prepare you for when you are able to earn more per month.
3. Use the 3-day rule
Have you ever made a purchase before, only to realize you really didn’t need it? This is where the 3-day rule comes in. This is when you intentionally wait for three days before making a purchase, especially for non-essentials. This strategy works by helping you avoid impulsive purchases.
It’s important to treat oneself from time to time. We still need to enjoy life even as we work hard towards our goals. However, we can’t just spend all of our money on enjoyment. As we budget our money for non-essentials, the 3-day rule will help us make the most out of it. While you wait before making the purchase, try to think of the use case scenarios the purchase will help you with. If you feel that it will make you happy for a long time and it’s within your budget, then go for it. If not, then it might be worth holding off on the purchase.
4. Automate how you budget
This saving tip might not be common, but it can also provide a big impact. Whenever you can, try to automate different parts of your cash flow. For example, if you have bills to pay, try to set up an automatic payment system if your debit or credit card allows for it. If your company has an auto-invest program, it might be worthwhile to enroll in it since it will help you invest hassle-free.
Willpower is a scarce resource. While we need to put in effort to become financially responsible, it’s always better to have a system that makes things easier. Bestselling author David Bach captured this by saying that people sometimes fail to budget because “You’re too busy, and you will just get frustrated and fail.” Experiment with the different features your banks and cards have, and try to make a system that makes budgeting seamless for you.
(P.S. If your company wants to conduct an auto-invest program for its employees, feel free to reach out to us!)
5. Spend more on quality
When people try to save, looking for cheap alternatives is a common way to save more money. However, sometimes paying up a bit more for a better quality product can sometimes be the wiser financial decision. For one, higher quality products sometimes last longer than cheaper ones. A 10-peso ballpen is far cheaper than a 50-peso one. But, if the cheaper one only lasts a week while the 50-peso one lasts for a year, then the more expensive option will actually be more worth it to buy. Always remember that in order to save the most amount of money, you have to be wise with every decision.
How long will it take to reach financial freedom?
Different people have different circumstances. It’s important to remember that you should focus on yourself. The road to financial freedom might be easy for some, and hard for others. Just remember that no matter how long or hard things get, the end goal will always be worth it.
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