It can be difficult to save money while you’re paying off all your debt accounts. You’re trying your best to manage your finances but nothing seems to work.
Something always seems to get in the way — your car might need a service or you’ve got unexpected medical bills. These unexpected expenses can prevent you from saving money. Sound familiar?
The truth is if you want to start saving money you need to plan ahead and budget for savings as an expense. If you’re waiting for the “right time” to start saving, it may never come.
The best way to start is by making savings part of your financial habits.
5 Practical ways to start saving more money
1. Reduce your grocery expenses
After creating a budget, most people are shocked when they discover how much they spend on groceries. It’s easy to walk through the shopping aisles and fill your trolley with a bunch of goodies. But those unplanned grocery expenses pile up and blow your chances of saving any money away.
Create a list before making a trip to shops and stick to the grocery list. Only purchase what you need and avoid buying things that you want.
If you’re still struggling to keep your grocery expenses down, use the envelope method. This is an oldie, but a goodie.
How does the envelope method work?
Withdraw your monthly grocery budget in cash and divide that amount into 4. Now you’ll have a grocery budget for every week and you’ll only buy groceries in cash. That way you restrict yourself from overspending and stick to your budget.
2. Buy generic
One of the easiest ways to boost your savings is to buy generic brands. In a lot of cases, the only thing making branded products better is marketing. These brands have the money to design good looking products that stand out on the shelf. But that’s really where it ends.
Generic products are in many ways the exact same thing as the branded products.
3. Save automatically
The best thing you can do to increase your savings is to set it on autopilot. You can easily set up an automatic transfer from your main account to your savings account. It is a good idea to set the transfer to go off as close to payday as possible so you don’t spend it by accident.
Simply set up a scheduled payment from your banking app and boom! You don’t have to think about it again.
4. Avoid lifestyle inflation
Getting a raise at work or receiving an inheritance for example can make us feel temporarily rich. Receiving extra money gives us the license to do what we always wanted. Like going on a vacation, buying a nicer bigger TV, or even buying a new car or home.
That’s usually what happens. Most people spend this extra money on things that make them feel good.
However, spending your extra money in this way is almost never a good idea. This money could be better used to pay off any debts you may have or to put towards your savings.
5. Put your spending on freeze
Play a financial game with yourself to help you realize that you don’t actually need as many things as you think. Don’t buy any extra nonsensical items for a week, or even for a whole month!
Avoiding takeaways, random goodies at the store, buying lunch at work etc. You’ll realise that these expenses start adding up and that there’s room to cut back on expenses and boost savings.
Trying to boost your savings while paying off your debt may seem impossible. It just requires you to start thinking outside of the box.
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