For many people, saving money can prove to be a real challenge. Despite our best intentions, it’s all too easy to fall off track – and getting hit with unexpected bills and expenses can make it feel impossible to get ahead.
Thankfully, becoming an effective saver doesn’t have to be difficult. In fact, by making a few simple changes, you could actually reach your financial goals a lot faster than you might expect.
So, whether you’re saving for a holiday or a new car, or even your first home, here are some important lessons that we can all learn from highly effective money savers.
Understand your expenses
Something that a lot of inexperienced savers have in common is that they struggle to keep tabs on all of their regular expenses. When creating a budget they may be able to note down their major expenses, the smaller (or less frequent) ones are often overlooked.
On the other hand, highly effective money savers understand that all of these little things add up, and recognise the importance of understanding where their money is going and making regular reviews.
Quite often, subscription services and memberships may be forgotten about, simply because they’re perceived as ‘affordable’. However, if giving it up is going to help you get closer to your goal, weigh up whether it’s something you really need, and if it’s not, consider giving it the flick!
Prepare for emergencies
Life is full of surprises, and unfortunately, some of these surprised can wind up being quite costly! Having a healthy savings fund to fall back on when times get tough is great, as it can prevent you from falling into debt, but saying goodbye to your hard-earned cash is no one’s idea of a good time.
Instead, most smart savers will plan ahead for these sorts of things by building up a separate rainy-day savings fund specifically for the purpose of emergencies, so that they won’t need to resort to dipping into their regular savings.
Pay yourself first
A common catch-cry among dedicated savers is to ‘pay yourself first’, and this is one piece of advice we fully support. For some, their idea of saving is to keep whatever is leftover at the end of their pay cycle – but when your cash is burning a hole in your pocket, the temptation to spend can just be too strong to ignore!
By paying yourself first, and transferring your savings directly to a separate account as soon as you receive your pay, you ensure that you have sufficient funds to save the desired amount and that you are effectively sticking to your savings plan.
Then, you simply need to budget the remaining amount until the end of your pay cycle, without worrying whether there will be any leftover to save.
For further support around creating a budget and getting serious about your financial future, schedule an appointment with one of the expert financial advisers at Rising Tide Financial Services today.