Hey guys! This is my tips in saving your money for beginners like students, fresh graduates, and also professionals. I hope this will help you.
1. READ PERSONAL FINANCE BOOK
a. Financial books are available online. There are writers who offer free ebooks (electronic books) so you can read them wherever you go. Start from the simplest to the more detailed ones.
2. UNDERSTAND YOUR EXPENSES
a. By jotting down your daily expenses, where does your money go? Fare? Food? Bills? It is important that you keep track of your daily finances from cents to thousands.
b. Analyze your expenses. Can the electricity bill go down? Sure it can. Unplug those unused appliances. Can my water bill go down? Yes it can. Save water by using buckets or drums or even recycle water from washing the dishes/ laundering your clothes. Can my fare budget decrease? Yes it may happen. If you are going to work or school, wake up early and start walking. Exercise and saving, what a great combination.
3. BUY FIRST YOUR NEEDS
a. When I go to the grocery store, I always bring calculator with me usually with my phone. Then, I set a budget on how much I should spend. Next, I list down the things that I need from the most needed to the least. I compute the grocery items. When I hit the maximum amount, I stop. Practice this and make it a habit that you should have a ceiling point. You wallet is not a sky so it does have a limit. Going beyond your capacity destroys your budget.
4. STOP SPENDING ON LUXURIOUS BRANDS
a. Why spend on expensive items when you can afford a generic brand? You can save up to 50%. No need to buy branded bags and shoes when you can support local brands that are made in your country. Local does not mean it’s fake.
5. DON’T BE TOO GREEDY
a. You are not prohibited to drink coffee in your favorite café and eat donuts in a mall kiosk. Don’t do this every day just to post something on social media. Save your money to buy essential items. Do not be too materialistic. Live within your means. If you can’t afford, then wait until you can. Learn how to say no to peer pressure.
6. NEVER MAKE SALARY ADVANCES
a. Your salary for the month of August should be spent on September. Do you get what I mean? You work hard today and enjoy tomorrow. Salary advance is the same thing as making a loan. Try to spend your 1-15 salary to 16-30 working days and so on. The cycle of making advances continues to goes on if you don’t stop.
7. USE PERSONAL FINANCIAL FORMULA
a. I have seen various formulas on how a person should allocate his or her money into different categories. These formulas depend in analyzing your expenses. What is your priority? These wanted to realize the desired result which is to achieve your financial goal or freedom. Reduce your expenses, get out on all your debts, have a liberty to attain your wants after your needs, these are the things they want you to know. So make sure that you stick to the program if you want to start using financial formula. Be consistent. It will all go down the drain whenever you disobey the course.
8. REUSE, RECYCLE, REPAIR
a. As long as the object is still useful, you may reuse it or recycle. Do not be an impulsive buyer that keeps purchasing anytime he wants. Put your hands in your pocket and just look at the items. Don’t let those itchy hands get in your budgeting. Canvass. Compare the items from one store to another. You can get lower prices by buying on public markets, surplus or other local stores.
9. SET DAILY ALLOWANCE
a. When I was in college, my daily allowance for school is ₱ 50. It includes the fare, food and school supplies I need. It became a habit that I have to allocate this ₱ 50 wisely so I can make through the day. I kept on doing this after I graduated. Since my workplace is near at home, I try to walk as much as possible so I can save my money and get away from the traffic. I do not put large amount of cash in my wallet. This prevents me from buying that my eyes see
10. KEEP AN EMERGENCY FUND
a. My uncle shared to me that I should have an emergency fund. This should be equal to your 6-month salary. It will be your budget in case you get unemployed. This emergency fund can sustain your cost of living.
There you have it. These are my personal guides in saving money. If you have additional tips or suggestions, you may comment it below so we can share it with others. 🙂
Note: Saving is different from investing.