Are you interested in knowing how to save money? Well, loin the party! It seems everyone is looking for answers to this question!
When you want to save money, you must follow a few rules. The bad news is these powerful rules have been around for centuries. And, very few people are able to implement them in their daily lives.
To begin with, you need a well-planned budget. Before you decide to save money, you must be aware of where your money is being spent. There is no shortcut for budgeting. If you want to find extra money or cut down expenses, you must understand the entire flow! Next, you should make a budget. A lot of successful people are able to lead a life without tracking their finances. You might be following their footsteps. Unfortunately, you need to make millions for such a lifestyle. When you are leading a normal life with groceries, utilities, entertainment, debt and household bills – you need a budget.
Budgeting is not about tracking every penny in your life. Instead, it is a way of controlling the amount you spend.
#2 Spare Some Money
The moment you understand where your finances are going, you must spare some. Try to open a retirement or a savings plan. This is a wonderful way of saving your money. Start saving on day-one!
A lot of people wait for their paychecks, settle bills, manage household expenditures and then think about saving. By then the amount of money they have becomes small. Soon, they will not be able to put some money into their savings or retirement accounts. This is a very big mistake.
To play safe, you must treat savings like every other bill. Just like how you would pay your mobile or electricity bill, you must transfer money to your savings accounts. Try to transfer at least 100 USD to your savings account. If possible, create an automated savings scheme. This way you don’t have to worry about depositing money into the account. The transfer will happen automatically.
#3 Spend Less & Earn More
The golden rule of thumb for saving money is: Earn More, Spend less!
If you are making $1,000 and spending $1,200, you will never be able to save! You are more likely to borrow funds, either from a loan or credit card. Borrowed funds don’t come for free! They carry interests. In the long run, interests will stop you from saving. To avoid such a situation, you must learn to spend less and earn more.