The inevitable happened. You find yourself sitting, almost crying over the meagre amount of money you have left for your spending. After all the bills are paid, grocery shopping done your few weeks ahead seemed desolate? You are experiencing the tragedy of barely making ends meet? And the problem has only exacerbated by the COVID pandemic. While it is difficult to end that cycle, here are some of the actionable steps that will help you to start saving money. Slowly but surely!s.
Budget…Budget… Budget If you have not done so before, now is the time. This is the first step to saving money. Once you sort out your budget for the necessities; loan, rent, utility bills, kids school fees, transport etc.. make a list of your personal disposable income (what I call the non-essential spending). You can always finds ways or areas where you can lower the spending. Few examples, you can cut out cable connection if you have a Netflix account and internet access. You can go to less expensive hair dresser, shop at a grocery store that is less expensive, reduce your food budget by eating out less (buying fresh vegetables and home cooking is not only healthier but costs less). If this new budget parameter is not working and you have got extra time, you can always consider baby sitting, dog sitting, picking up grocery for your neighbour or even carpooling (ride share service) or even start an organic kitchen garden that will not only provide you with fresh organic vegetables but will help you save a lot of money and time). Last year I started my small kitchen garden (I will post about it in the near future), from salads to beans, cauliflower, aubergine and the daily herbs, I have enjoyed every harvest. Plan your budget in a way that every money earned from odd jobs, goes straight into your savings account.
Have a savings account It is essential to have a designated account for your savings. Look for an interest-earning saving accounts, initiate a first deposit and feed it whenever you can. I have designated 15% of my income to my savings account on a monthly basis and every now and then I deposit any minimum I can into this savings account. This way I ensure I am saving at least part of my paycheck. So re categorise your savings account as a blackhole, money in ONLY.
Remortgage or Refinance No matter how small or significant a debt you have, there are ways to prevent your debt from restraining your ability to save. I was struggling with a student loan so long that I went to re-negotiate repayment terms. I was offered the refinancing of my loan at a lower interest rate and this small reduction in the interest rate has helped me pay off my debt faster. Yes, banks are here to do business but they also offer assistance over your finance. They are here to advise you on your repayment terms, your interest rate, managing your finance in the best possible way so that you are able to settle you loan. At the end of the day, helping you guarantee the repayment of your loan.
Revisit your utility bills I remember my mother always telling us to switch off the lights when we were not in our room, or to switch the TV off is nobody was watching. I grew up in a house where we had one TV, one radio and one computer. The TV and radio would very rarely play at the same time. TV time was family time and everyone would watch the same thing, unless there is a football game playing. So growing up, I maintained that lifestyle. Using energy efficient bulbs, a water solar heater instead of gas or electric ones and have also installed solar panels on the roof that provides a third of energy to my household and the other 2/3 is sold to the electricity provider. This helps save cost in the process and a 100% return on the investment made to install the solar panels within a year. Same goes for the car insurance, I shop for better rates when my policy is up for renewal and have recently come across an article about bundle policies (I will write about it in my next post). I have also replaced my credit card with a pre paid credit card. This way I only refill my card when the need arises. Having a credit card handy is too tempting and with the high interest rate only increases your debt.
Rent out a room A lot of students travel to the country for a specific period. If you have a spare room and you are within the vicinity of a university campus, why not offer a room to rent. This will not only help grow your savings account but you will also have good company, make new connections and above all cut your utility bills in half. Be open to the possibility of renting that spare bedroom, or concerting your garage into a spare bedroom.
Savings happen when both your physical and mental elements are aligned. While your aim is to save money, being debt free should be your number one concern. It’s only after clearing your debt that you will be able to save money for the travel, the car or the apartment you wish. While it will take time and sacrifices for you to build your savings, your every little effort leads you closer to a stress-free life. Your deposits will grow with time, your savings goals will be reached and you will feel the sense of accomplishment. My father used to say “its the little things that makes up the big thing”. So start small, be consistent in your action and reap the fruit of your labor.
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