How to save money? Do I have to cut down my desires? How do I start?
These are few questions which boggle in our minds when we think about saving money. Most of us cling upon saving money irrespective of the financial status but fail to understand how to begin with. It looks like a rocket science when it comes to saving money on major things. Sometimes it becomes a hard task to decide a simple means to save money and how you can utilize your savings to achieve your financial goals.
Just get started!
Just surfing the internet to look for ways of saving money, will not actually save your money. Just get started with a simple plan. We give you a step-by-step manual on money saving strategies which can help you to get started on this venture to develop a realistic savings plan.
Step 1: Pen down your expenses
The first and foremost step of the saving guide is to understand and keep track of how much you spend on a daily or weekly basis. Start to pen down every penny you spend starting from how much you spend on your coffee, newspaper etc.
Now that you have a data record of your expenses, start organizing with categories such as gas, groceries, outings etc. Once you categorize the data, you will have a fair idea of how much you spend on each thing and where you can cut down the cost.
Step 2: Your budget plan
You have the record of your expenses and an organized list, now the next step is to make a workable budget that suits you. Create a table with columns of your income, expenses, and savings. This will help you to cut down on the over spending and unwanted expenditure.
Step 3: Mission- Save money
Always keep a track of your miscellaneous expenses which includes the party expenses, candle light dinner, taxi, entertainment etc. This miscellaneous column can help you save a fortune if you plan on where you can minimize your expenses. The savings category in your budget plan will determine how much you want to save money every month. Plan in such a way that you put at least 10% to 15% of your income into your savings column. Sometimes the figures may vary.
Step 4: What to save for?
The most important step is to have a goal. A goal for which you are planning your savings like buying your dream house, going on a vacation. This will motivate you to stick to your savings plan. Once you have a goal in mind, you will have a fair idea of how much you need to save every month and how long it will take to achieve the goal.
Step 5: Break into bits
Sometimes it becomes hard to save the same amount every month. It’s better to prioritize and divide the dream goal into short and long term goals. This will help you to save money depending on your priorities and you will have a clarity on your savings plan.
For instance, you can create a short-term plan like this:
My short-term goals (1-3 years):
|Short-term Goal||Budget||Savings per month||Duration to reach goal|
|Vacation to Greece||$10,000||$2,000||5 months|
|Emergency fund||$5,000||$1,000||5 months|
My Long-term goals (4 years & above):
|Long-term Goal||Budget||Savings per month||Duration to reach goal|
|Down payment for Home||$30,000||$1,000||3 years|
Step 6: Set priorities
It is very much important to set priorities in life. This will help you to plan better in every walk of life. When there is the clarity on what is important on an immediate basis and what can be held on for a long time, and then you will have focus. Setting priorities will have a great impact on the savings model you design. You can add a column in your savings manual as “Priority” based on low, medium and high.
Step 7: Opt tight to save right
Look for ways to utilize the bank savings plan which can yield a good interest rate in return. Sign up for every free customer reward programs to get discounts and cash-back offers. There are a lot of ways to get hot deals that might add up to your savings.
Every small effort adds to a big amount when it is about money saving. You can create your own savings manual to chase your dream with minimal effort. This can help you to save money without any crunch on expenditure. Keep reading our blogs for more interesting topics.
How do you make sure your saving enough every month?
FREE Money Saving Hacks Guide
Learn some incredible money saving hacks that will help you save over $10,000 per year!