People find spending less the basic way of saving money. However, this is not always easy to accomplish as you may have to face many challenges. To overcome these hurdles, creating a budget is a very effective way. Make your monetary plans and then keep track of your money on a monthly basis. Check how much you are spending and where. For this, you can either choose a custom-made spreadsheet or even use tools for more convenience and accuracy. There are many tools available online for your assistance. At the month-end, you will be very surprised to know that you are spending a good deal of your income on food cravings.
Expert Tip: At least save 20% of your income to avoid a financial crisis. To help you save more, we will introduce you to 7 things you should know and follow.
1. You are your primary concern
Keep your financial stability the top priority. Make it your habit to directly deposit some proportion of your income. It is always better to save beforehand than to spend it recklessly.
2. Maintain a budget
Creating a budget is the first step in becoming a real saver. It helps in keeping track of your spending. Also, it notifies where and how you should cut back your expenses. Earlier you may not be aware that 20% of your income is spent only on your food. However, budgeting may help track your expenses.
3. Set a saving target
Start saving money with small budget targets as the bigger one will be challenging initially. You may start saving around 10% of your income on a monthly basis, achieve it and raise the target for the next month. This way it will be easier for you to limit reckless spending. Set up alerts for reminder purpose to achieve your saving goals.
4. Financial Helpline act as a financial friend.
Always try to reach financial helpline or online financial services which will help you compare the rate of interest on various products and help you choose the best among them. These are the most important as well as toughest decisions as some products have some hidden conditions associated with them, and others may not suit your budget.
India’s First financial helpline – www.dialabank.com
5. Think twice before buying something
When you go out shopping and find something you want to, but, give yourself 24 hours to figure whether you need the item or not. As Warren Buffet says “If you buy things you do not need, soon you will have to sell things you need”.
6. Save extra cash
Every time, you receive extra money, put it into your savings account before you spend it. It may be your tax funds, life insurance premiums and bonuses, incentives or cash as gifts.
7. Feed your piggy bank
Make it a habit to put the change you get from making several payments or breaking bills, in a piggy bank. This way you will be saving every penny. So when the piggy bank is full take it to the bank to deposit it. This way you won’t even realize how your small change turned into better savings.