 Many
people would agree that whilst spending money is easy,
budgeting and saving money are another thing. So we have
put together some handy tips which may assist you to reach
a goal or just make sense of where your money goes.
Know what your spending
Before you can save money, you'll need
to work out what you're spending on a daily basis. For
one month, keep a diary or list to determine your spending
habits.
Another way of seeing where your money goes is to keep all of your receipts
and dockets for one month. Keep track of everything, including those items
for which you use cash. E.g. train tickets, toll money.
Are you making what you spend?
You will never save money
if the sums don't add up. Bluntly put, in order to save
you can't spend more than you earn. It is simple addition
and subtraction. Add up what you earn and take away what
you spend and then ask yourself "Is there anything left
to save".
If you answered yes then you are already on the way to
wise bugeting, but could you make it better? If you answered
no then maybe its time you looked closely at your spending
habits and considered some of the tips below.
Set money Goals
Before you can budget or save money you
will also need to set some short and long term money goals.
With out goals you have no incentive to save or budget.
"Chunk" your goals
For those who are not
used to saving one of the most frustrating things
is that it seems to take so long to reach a goal when you
start with nothing. One suggestion is to "chunk" your
goal into smaller achievable pieces. For example
you want to save $10,000 for a holday or deposit
for a house. Start by saving to meet a short term
goal of $2,000 then $5,000 and keep going until
you reach $10,000. It doesn't mean you stop saving
once you have reached your first "chunk" but
mentally it can help you stay motivated by knowing you
can achieve your long term goal of $10,000.
Look for opportunities to be
money wise
Here are some suggestions, which may help
you to save money on a daily basis:
Food.
- Plan your meals a week ahead
- Prepare a grocery list and stick to it
- Keep track of specials that are advertised.
- Buy store or generic brands
- Buy in bulk
- Pack a lunch at least three times a week you'll be
amazed by how much you will save a year!
- Work out a
budget if you eat out frequently and look out for
restaurants that are B Y O.
Saving on your power bill
- Install weather stripping on your
windows and doors
- Take a shower rather than a bath
- Turnoff all unnecessary lights
- Ensure the dishwasher and washing machine are fully
loaded before turning them on
- If your cold throw another layer of clothes on
- Turn off house
heating when you are away at work during the day
Saving on your phone bill
- Cut your phone bill by looking to see if there is a
provider with better rates than what you are paying
- Discontinue unnecessary services
- Set a timer when making a long distance call
Saving on your monthly expenses
- Cut up all credit cards except one. Transfer the balance
to the card with the lowest interest rate. Make as large
a payment as possible each month
- Shop around for deals on hiring video movies
- Carpool, share a ride, or use public transport
- Drop unnecessary newspaper and magazine subscriptions
- Shop around for specials on books CDs
Saving on housing expenses
- Refinance your home when the interest rates are down
- Refinance a 25 or 30 year term mortgage for a shorter
term
- Look for a mortgage that allows more frequent payments
- Use a mortgage offset facility and have your pay deposited
directly against your mortgage.
How to Become More Money Savvy
- Never purchase an item that costs more than one hundred
dollars without leaving the shop first. Think about it
for 24 hours or more before you buy
- Separate your wants from your needs. Ask yourself if
you really need the item or if you merely want it
- Acknowledge instances when you are unable to afford
a given item
- If you see something you want to buy, stop and think
how many hours of work you require to perform to pay
for it. Consider the hours you will have worked after
paying tax. This technique may help you reevaluate your
wants.
- Put all your loose change in a jar and count it once
a year. Use it to make an extra payment on a bill, or
better still treat yourself!
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