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Do you find yourself with no money every month?
Do you use up all your salary to pay for your utilities, bills and all other expenses in the first week and then dread the next three weeks whilst you wait for payday?
Do you find yourself saying one (or more or all) of the following:
If yes, then this post is for you. And I think it’s particularly relevant now that the New Year is almost upon us.
This is the time most of write our New Year’s Resolutions and if yours involves cleaning up your debt or taking your finances in hand, then this post is relevant.
It’s written by Andy, a blogger and financial writer associated with the Oak View Law Group. He is a debt expert and a member of several online forums where he shares his advice as well as tips to lead a financially independent life.
I recommend that you bookmark this page, read it carefully, take good notes and then implement the strategies ASAP.
Here’s to your better financial future!
When you are so keen to save money, you must keep your eyes open, and look for all the opportunities around you, that lets you save even a single dime!
I have seen people, become real cheap and tacky, so as to save as much as they can. Be it some thousand dollars, or even 1 cent.
However, you are not asked to become one like that, as in your money saving spree, you will end up missing out on all the pleasures and happiness this world has to offer.
But still, the secret to saving successfully is this: saving money can only take place through obsession and an undiminishing interest of building wealth. If you lack the slightest of interest it takes, to stash in a minimum amount each month into your savings vault, then probably you can never build yourself a sufficient amount of savings or even wealth.
This post is not meant to teach you why you should save money, or the importance of saving money, or how to motivate yourself to save money.
It is well understood, that it is a necessity to save money, and it doesn’t matter whether or not you are interested. If you don’t find saving money to be interesting or enthusiastic, then it’s your loss – literally as well as figuratively.
This post is written to open up nice strategies and plans for you to save money, so that you can become wealthy, and increase your net worth steadily with time.
Here are some real time money saving tips, that you should take a note of.
Measure your income and expenses
The amount of money you can save is directly proportional to the amount of money you earn.
And, it is inversely proportional to the amount of money you spend!
You got the meaning of it?
The more income you have, the more you can save. The less expenses you have, the more you can save. That’s the basic gist of it.
That’s why your first move under this scenario will be to increase your income (either by taking on one-off jobs, more permanent side hustles or going traditional and getting a promotion), and the next step will be to cut down on monthly expenses.
Increasing your income won’t mean you can now pick up costly luxury expenses. All the extra amount you earn will go down to savings!
As George S. Clason wrote in The Richest Man in Babylon, “First, get thee an army of golden slaves and then many a rich banquet may you enjoy without regret.”
In other words, your savings must work for you and each single cent is a money slave that will also work for you.
If you use them on mindless and luxurious spending too early in the game (ie.: before you have enough), then how can you gain wealth?
Believe it or not, no financially successful person ever spends mindlessly, no matter how much they earn.
You can only call yourself rich and successful, if you have good savings to boast of!
Side Note: This is especially important now as we gear up for the holidays. This is the time when most people splurge – buying presents, celebrating the end of one year and the beginning of a new or taking advantage of sales – and end up getting into debt. For tips on surviving Christmas with your finances intact, read How Can I Spend Less Money For Christmas.
Get hold of a simple budget plan
This is the most realistic of these real money saving tips.
You can start off with any random plain budget, that lets you dedicate a handsome amount to your savings account, each month, from your paycheck.
I suggest you try out the fixed percentage budget. This works best for those with variable income, and even better with fixed income.
In a percentage budget, you assign all your expense categories and savings, a fixed percentage of your income.
So, it might look like, you keep aside 20% of your income for savings, 10% for transportation costs, 30% for utility bills, 20% for groceries, and so on.
The percentage amount helps you to equally distribute your income into several expense sectors, independent of the amount you earn each month.
So even if you earn $1, you would still be dividing it as per the percentage budget, and maintain the flow and consistency in taking care of expenses and doing savings at the same time.
The $1 example is just for the sake of giving an example and to prove how authentic and effective your percentage budget can become, if you remain dedicated.
In the end, it’s not the amount but the process that matters.
Stay away from debts, and save on debt payments
Debt payments, if you have debts, are something you should consider very seriously.
Most of us have debts, no doubt about that. But, with a little effort we can definitely erase them, and give ourselves more scope to save money.
Most of our debts are made up of credit cards, and quite often payday loans and/or personal loans. Not only they carry high interest rates, but also their monthly payment amounts are not a joke.
Situation can get a lot worse, if the debts are into collections, and you are charged hefty amounts to clear your debts.
In all these cases, you should look for suitable debt relief options (different countries have them), and check whether or not the debt collection agencies are charging you extra money by doing FDCPA violations!
You might not even know that you are paying a lot of extra money for the debt payments, the money which you can, on the other hand, use to build yourself some more savings.
And, if you have too much debt then you can likely avail of a professional debt settlement, and save chunks on your total pay off amount!
Make room for lucrative investments
Just saving money will not do the job, especially if all you did was park your money in the bank, where it will likely do nothing.
Unfortunately, that won’t increase your overall savings scenario enough to make it worth your while.
As mentioned before, a big portion of your savings should be working to earn more money. The only way to do so, is to invest your money in the right investment vehicles.
Say 10% of your savings is invested in mutual funds. You can even use a portion of your savings to make down payments for a new mortgage, and get better loan terms for the property asset.
There are stock market, bonds, equities, and so many other high return investment vehicles, that you should be utilizing.
But, before you make investments, it’s better to get a professional consultation from someone who actually knows what they’re doing because investing always carries risk.
That said, while it is definitely a bit risky, success rates are also high, and you are good to go if you get all the right help from the experts.
So, here we have come to the end of our post.
I want to conclude by saying, that saving money has no end and limitations.
And, priority is what matters the most. If you keep savings as the top most obligation, ahead of all your monthly expenses, then within a few month’s time, you should be in a good position, with nice savings in your hand.
And you will never again have to say I run out of money every month, I am broke and depressed because of my finances, I don’t know how to save money or I need help with financial planning.
Therefore, keep calm and save on!