Whoever said “more money, more problems” probably never had to scramble to pay their bills. And whoever said money can’t buy happiness hasn’t considered that what it does buy is the time and opportunity to pursue what makes you happy. So if you’re looking to save a little more money for the future, we’re all for it!
But putting away money for a nest egg is often easier said than done. Too many of us live paycheck to paycheck and have no idea how to save money when it’s a struggle just to pay bills on time. Keep reading for some ideas on how you can save more money in both the long and short term.
Set a realistic savings goal for the year—and break it up into manageable amounts.While it might be nice to say you’re going to save P500,000 or more this year, the peso signs in your eyes may not survive day-to-day reality. Think about how much you can afford to put away each month, and multiply it by 12 (or 13, to account for your 13th month pay). Push this goal a little further so you are motivated to find ways to save more.
Identify what you want to save money for and how much it will cost.
Saving money “for a rainy day” is a nice enough idea, but it may help to have specific motivations. Maybe you want to save up for a dream vacation, car, home, wedding, or something else entirely. Research how much you’ll need to be able to afford it and keep that goal in mind when depositing your savings and when considering unnecessary expenses. If you’re the kind who works better with visual cues, create a vision board and keep a chart you can mark off every time you get closer to your goal.
Do a self-assessment of your expenses to identify where you can cut back.
Find out what you’ve been spending your money on and identify which expenses you can shrink or eliminate. Sure, that daily cup from a coffee shop might be essential, but how much would you save by bringing quality ground coffee and a French press to the office? And what brand-name items do you buy regularly when you can switch to generic? If you mostly communicate through messages and calls through Facebook and other apps, consider downgrading your postpaid plan. How much TV do you watch in a month? Are you more inclined to just stream on Netflix or pay per channel instead of a broad-spectrum cable plan?
Track your savings and expenses.
Don’t just do a one-time assessment of your finances. Keep track of what you spend weekly, daily, and monthly. There are many easy-to-use apps that can help you do this, such as Wally and YNAB (You Need a Budget). You can also track expenses manually through your planner or journal. Take note of how much money comes in through your salary and other income and how it flows out, whether it’s for utilities, bills, groceries, shopping, and more.
Make a portion of your savings difficult to access.
Having ATMs in every commercial area makes it all too easy to withdraw money on a whim. While you should have an accessible source of cash in case of emergencies, you may also want to make some of your money harder for you to withdraw whenever you feel like it. You can open a passbook-only account or have a separate account and leave your ATM card at home; you can also go for time deposits, mutual funds, and other options, which you’ll actually get higher interest rates on.
Pay yourself first.
If you think of saving money as something you do after you’ve paid out all your expenses, it can be very difficult to stick to your goal. Try taking the amount you want to deposit out of your salary right when you receive it. Then work your expenses around what’s left. This might leave you less likely to indulge in unnecessary expenses.
Charge what you can afford to pay within the month.
The lure of credit cards is very tempting, but it can leave you stuck in debt and paying high interests, which is not at all conducive to saving money. Instead, live within your means and save your credit card for emergencies or for expenses you have planned out.
Clamp down on your attraction to “-ests” (newest, fastest, prettiest, best, etc).
People say, “Don’t fix what ain’t broke.” Well, don’t replace it, either! Given how frequently stores flaunt the latest gadgets, fashions, and other goods and restaurants tout the hottest new foodie trends, it’s all too easy to get caught in the trap of chasing unnecessary superlatives. Ask yourself if these indulgences are worth possibly missing out on that dream you’re saving up for.
Maintain a miscellaneous spending fund.
Saving money doesn’t have to mean depriving yourself of creature comforts or retail therapy. It just means establishing hard limits on how much to spend on non-essentials. Try budgeting for such expenses. This way, you know that if you want to go out to more dinners with friends this month, you’ll need to cut back on shopping or lunches out, for example.
Find ways to increase your earnings.
In the age of inflation and higher taxation, saving your money will only get you so far. Look for ways to increase your income. Push for a promotion and raise or work toward extra commissions and bonuses. Turn your hobbies into profit opportunities—you’ll be surprised at how much you can make from something that starts out at a side hustle! The more you make, the more you can put toward your savings goals!