Whether you’re saving to buy something special or putting money aside for your retirement, most people are saving for something in their life. There is plenty of literature and advice on saving but the act of doing it always seems to raise more challenges than many can handle.
The most important thing is to be disciplined and regular. You won’t change your financial situation in a day, but steady and persistent cash flow management, with the benefits of compounding, can make a huge difference to your savings goal in a surprisingly short period of time.
Here’s 10 of the best ideas you can start implementing today to increase the amount of money you will save, and set yourself on the path to financial freedom.
- Set a goal. If you want to get somewhere you first have to know where ‘there’ is. Set an amount you want to have saved and a timeframe you want to have it by. Pin it to your bathroom mirror where you will see it every day.
- Regular and little. Putting even a small amount of money aside on a regular basis will pay huge dividends. Waiting until you have enough saved up will see the money disappear before you even get it put away. You won’t miss a small sum taken often.
- Pay yourself first. Before you pay any bills put a small amount of what you’ve earnt aside in your savings account and promise yourself you won’t touch it no matter what.
- Cut back on lunches and coffees. At $10 per day for lunch and $5 per day for a coffee you will burn through nearly $4,000 in a year. Take your lunch with you and at least reduce your coffees to every second day.
- Review your expenses. When did you last look at what you spend? For most people spending is automatic and doesn’t attract much thought. Have a look at your bills like insurance, electricity, and other household regulars and ask yourself if there is a cheaper option.
- Buy second hand. Do you need the latest and greatest? Everything from appliances to vehicles cost much less when they are run in first. You’ll often get 80% of the benefit for less than 50% of the cost.
- Hide your credit card. Temptation will always be with you if you carry your credit card around. Put it in a draw where it’s not easily available.
- Before you purchase sleep on it. Before you buy take a day to think about it. Is it still worth buying? A good night’s sleep will take away the urge to impulse buy and allow you to make a more rational decision.
- Use a shopping list. Buying groceries without a shopping list is a recipe for overspending. Prepare a list and stick to it – and shop on a full stomach, you’re less likely to purchase snacks!
- Have friends for dinner. Eating out for dinner can be one of the biggest cost killers for anyone. Have friends over for dinner even if you’re planning to go out later – it will leave more cash in your pocket.
Saving can come with its challenges but like a diet don’t give up the first time you have a ‘bad’ day. Get back on track and promise yourself you’ll stick to your savings plan – the results will be more than worth it.
If you’re thinking about how you can save more money for the future, you may find it beneficial to talk to a financial advisor who can provide you with the knowledge and advice to make the right decisions.
Mynextadvice helps individuals connect to the best Advisors in just a few clicks.
The information in this article is general in nature and does not take into consideration your personal situation or circumstances. You should consider whether the information contained in this article is suitable to your needs and where appropriate, seek professional advice from a Financial Advisor or other finance professional.