Money is like a kind of vitamin, which is called vitamin M. As your body requires all of your vitamins to stay healthy, you need money to keep you safe and wealthy. In these uncertain times, when people lose their jobs, everything requires vitamin M.
It reminds us to keep some money for the bad times. When you have liabilities or you are running your household with a single source of income, it’s all-important to save money. Our social media and eCommerce platforms know our interests based on our previous purchases and likes/dislikes. The same feedback they share with the marketing agencies to lure us with attractive and targeted advertisements, which are hard to resist.
A proper plan with firm determination and a good execution can help you to achieve your saving goal without feeling deprived.
Here’s a look at a famous quote by Thomas Fuller ~
“By the same proportion that a penny saved is a penny gained, the preserver of books is a Mate for the Compiler of them.”
So, rather than hoping and waiting for your next big-bang saving opportunity, we’ve decided to put together a few essential and smart ways to revamp your savings to grow consistently over time without any hassle.
1. Set an automatic deposit.
One of the smart ways to save more is to go with an automatic savings plan, a personal saving system. It’s a method in which you, as a plan contributor, automatically deposit a fixed amount of funds at specified time intervals into dedicated accounts. This way, you can set up your finances on autopilot and watch your savings flourish. In this plan, the time intervals between deposits are not necessarily important but consistency matters. This strategy can help you to save money on a monthly, bi-weekly, or even weekly basis.
2. Make a list of your monthly expenditures.
All you need is a list of the last three months’ expenses. Categorize it by defining the name of the expenses. Label your food and eatery items with “Grocery Expenses”. Your restaurant bills can be labeled with “Restaurant Expenses. Similarly, the rest of the expenses you can label with your own categories. If your spending is monitored through apps your work will be easy, as the predefined categories in these apps put the expenses inside automatically. Though, if you don’t have then you can take out the summary from your bank and then label it.
Cash withdrawal expenses may not be reflected in the summary, which you need to memorize if you can. Each penny of money will help you to make a plan further. It is important to determine where all of the money you spend goes.
3. Use finance apps to track your spending.
Using finance apps can also play an important role in managing your finances. By monitoring the flow of money to where it’s going, finance apps let you track your finances in every aspect to work toward financial success. The best part about financial apps is they enable you to access your financial situation on the go.
Numerous money management apps are accessed through mobile apps or any device and make it easy to take care of your finances no matter where you are. Here are a few essential financial apps you could look into.
- Personal Capital
- Pocket Guard
These apps help you to understand your finances at any moment. Plus, you can easily enhance your money management skills. This method provides you the right way to match your busy lifestyle and watch your situation improve.
If you don’t like using finance-oriented apps, you can always use a spreadsheet. If you do, make sure you are putting in the effort to enter and categorize every expense.
4. Don’t accumulate credit card debt.
If you have a habit of overspending with credit cards, this is something you need to stop doing this immediately. To protect yourself from credit card debts, hide and keep them in a safe place. By keeping the cards, staying away from yourself can help you not accumulate unnecessary and major debt.
Keep track of your credit card spending and make sure you can pay them off each time they are due. Remember, just because you aren’t physically handing over cash when you swipe your card doesn’t mean you aren’t spending money.
|Pro Tip: In case of an emergency, you can use credit cards for small purchasing only. If you could manage not to use credit cards for even small purchases, you’ll gradually be capable of living without your credit cards.|
5. Say “No” to excessive online shopping.
There’s no room for doubt that online shopping is a blessing and a curse at the same time. Sometimes, we all over-indulge in online shopping without watching out our expenditures. If you’ve goals to save this year, you need to stick this tip #5 to save your money. For instance, Amazon Prime can deliver products in minimal time; however, if you feel like going a little overboard with such online shopping, take a step back and ask yourself “Can I manage without using this?” You can also try out the “48-hour rule” and give yourself 48 hours to think about your purchase before completing the order. This can help you cut down on unnecessary impulse purchases.
6. List out fixed and variable expenses
It is important is to know what is a fixed and what is a variable expense when categorizing expenses.
Why is it important? Fixed expenses have the least chance of saving money. On the other hand, variable expenses have a lot of opportunities where you can save money.
Examples of fixed expenses are:
- Mortgage bill
- Insurance bill
- Loan payment
- School/College fee
- Electricity bill
- Internet/Wi-Fi bill
However, Electricity and Internet/Wi-Fi bill depends on usage. In fixed expenses, you can’t do anything unless you reach the completion of the loan or fee.
Examples of variable expenses are:
- Grocery items
- Restaurant bills
- Medical bills
- Shopping bills
- Credit card bills
- Travel expenses
- Unusual Purchase
- Gym/health center fees
- Party expenses
Once you finish the bifurcation of the items, you will get more visibility on expenses. You can also take a look at your variable expenses and consider what you can do to cut down on these expenses.
7. Buy in bulk
Buying with a calculator is an excellent idea when buying in bulk. Cost per unit calculation helps you to decide whether to buy in bulk or not. A simple math term is involved here. Look for the lowest cost-per-item and balance that with the quantity being sold.
|Item price ÷ Items weight or number = price per item|
When buying in bulk, the shelf-life of the items is also important. Here are some items you can buy in bulk:
- Dry fruits
- Dental care (Toothpaste, Brush, Mouth Freshener)
- Tissue papers
- Edible oils
- Canned food
- Tetra packed food
- Dry beans
These items you probably shouldn’t buy in bulk:
- Fresh vegetables and fruits
- Fermented items
- Dairy products
In addition to saving money on items, this analysis can be a good financial habit. To save consistently can give you the motivation to save more and more.
Ready for something inspiration?
“A penny saved is a penny earned.” ~ Benjamin Franklin.
In today’s time, the absolute safest way to invest is to save money. The strategies above ensure you save big returns on your money, which is surely risk-free and guaranteed. Now that you must have known the smartest ways to start saving for yourself for the long-term.
Embrace these tips to save without feeling broke and depriving yourself. By applying these sure methods, you can develop a sense of discipline around saving and enhance your financial situation.