Another day brings us all the chance to learn how to better manage our finances.
We know everyone’s busy at this time of year, so let’s cut right to it with a series of ten strong tips on how to develop and flex your saving muscle!
Stop impulse buying
The best purchases are pre-planned. This applies to just about every expense you can incur in life! It doesn’t matter whether it’s food, a car or an entertainment item; you’ll spend less and save more if you give yourself time to consider the purchase before you pull the trigger.
This is an easy change to make, but it can unlock massive savings over time.
Overdrafts are the subtle killer of many a savings plan. Just as you can build a spiral of positive and responsible savings, so too can you develop monthly habits wherein you lose money through overdraft fees and interest.
The worst thing about overdrafts is that you won’t ever need them if you save properly. Use your own savings as an overdraft that doesn’t needle you with fines!
Sometimes, the best way to psyche yourself up for a change of habits is to look towards successful people. If you’re about to shake things up with an eye towards a better financial future, consider looking at suitable celebrities and figures who have been there and done that.
It’s a great way to add perspective and motivation to your newly laid plans.
Appreciate compound interest
What is compound interest? Simply put, it’s the interest that your interest gives you! If you invest £100 and earn £10 further in interest, the further funds that £10 then accrues is ‘compound’.
While it isn’t an instant fix for your finances, understanding how your money ramps up and scales over time through savings is an important lesson to learn.
Use a savings account
It’s easier to save when you can see your money increasing with every month. The majority of us haphazardly save in our main account and spend from it – a poor choice.
The distinction between your savings and spending money will combine with the satisfying visibility of a growing safety net. It feels great.
Most of us look at our monthly pay as the funds for the month – no more. It’s easy to do. The best way to flex that saving muscle, however, is to divvy up what comes to you.
Instead of just generally using your account for everything, pay yourself a portion of your money for fun things like entertainment – but only after your bills are paid and your savings allocated.
Ditch the minor habits
Sounds counterproductive, doesn’t it? The truth is, you have a limited amount of energy and willpower every day and it’s important to prioritise its use.
If you’re working on your savings in different ways, take an honest look at how much return on investment you receive. If something takes an hour a week, but barely saves you money, consider focusing your efforts elsewhere.
Learn your behaviour
An honest look at the storyline of your actions over a week can do a lot to improve your savings power. If you’ve slipped and splurged on something you knew you shouldn’t have, don’t blindly attack yourself for the mistake.
Instead, consider what happened. Did specific things lead up to the event? Looking back in this way can help you understand what to avoid in future.
Budget nights out
It’s a fair bet that most of our readers have had a fun night out that cost more than they wanted it to! If you’re enjoying a weekend or weekday night with friends or family, set a hard budget for yourself by taking cash out and leaving your wallet at home.
You’ll thank yourself when the month ends. If you’re drinking alcohol, it’s all too easy to cut loose and spend more than you should.
Automate your saving
As far as you can, you should automate your savings payments and bills. While it’s good to have control over when you pay in general when it comes to savings it’s beneficial to know that set amounts are going where they should every time.
This is an effective way to ensure that you save reliably. Saving shouldn’t be about admin!
In a pinch?
Thanks for stopping by! We hope you found the article helpful. If payday got the better of you, Everyday Loans offer short-term loans with excellent conditions to help you get by. Visit our homepage to learn more.