Earning money is an art and so is money saving. Saving money becomes difficult with flat wage growth and the ever-increasing cost of living.
With lots of apps to keep track of your expenses, you can save with little effort.
Here, we are suggesting some tips which can boost your chances of saving money successfully, not only for short-term goals like vacations but also for long-term goals like building up saving for a home deposit.
1) Prepare Budget
The budget helps to keep track of whether your spending is more than earning or vice versa. Check your credit card statements, bank statements and receipts and bill, etc to work out your regular expenses including you are home rent or loan EMIs, transportation, insurance premiums, electricity, and other bills.
Budgeting helps to prioritize your expenditure and strike the balance between spending and saving for the whole year.
Evaluate the budget to check which the items of basic living expenses are and which are extra which you could do without, for saving money. Update your budget once every year or more frequently in need of special circumstances like losing a job, having a baby, etc.
2) Keep Records of Your Spending
It is very essential to keep track of your day to day spending so that you know your monthly expenditure. Tally your expenditure with your bank statement to make out what is going into your bank account and how much you are spending out.
Compare your budget with your actual statement and identify the areas where you can save. Check if you are sticking to your budget or not.
It will help you ward off impulse purchases of unwanted goods.
3) Clear Your Credit Payments on Time
Credit card interest can cost you heavily. Pay your credit card in full and on time to avoid interest charges and late payment fees.
To avoid missing your payments, choose for direct debit payment which would be more than the minimum required to avoid interest on any late payment. Or, you can alternatively draw cash every week to meet your weekly requirements.
4) Curtail Your Recurring Expenses
Curtailing your recurring expenses like that on electricity and gas, fuel and vehicle services, mobile, and internet service plans. Try choosing the lowest priced services providers and avail discounts wherever available can help you boost your savings.
Also, control your impulse for extra expenditure on tempting non-essentials.
5) Go with Bill Smoothing
Bill smoothing is a payment system offered by various utility providers like electricity, gas, or water) where the customers make bill payments fortnightly or monthly, rather than paying the whole bill in a go.
It protects people on the budget from receiving bill shocks. It allows you to save money over time to pay for certain bills annually.
Sometimes companies offer a discount for paying bills and premiums in installment rather than one hit payment at the end of the cycle.
And sometimes it is vice versa. So, check for the most beneficial mode of payment to save your hard-earned money.
6) Try to Negotiate Again For Rent/Mortgage
If you have built up a good credit history or a good rapport with your landlord or loan provider, fair chances are there for negotiating about the interest rate and loan EMI repayments. A frank discussion about your inability to meet higher interest rates could result in lowering your payments. Trying could be fruitful, you have nothing to lose.
Be Thrift in Spending
Many people take the virtue of being thrift (careful in spending resources and money and not wasting it impulsively) mistakenly for being miser but there is an obvious difference between two.
At thrift consider financial requirements ahead and focus on earning, saving, and investing to meet financial goals. However, misers do not spend even on the necessities and compromise with the quality and quantity every time to save.
With calculation and evaluations, you can be thrift.