Money is what allows us to pay for our basic needs. Water, food, shelter, and clothing are the basic things that we need for survival. We need to work to ensure that these needs are consistently met. Now that you have a job, you face another struggle: You squander the money as soon as it lands in your hands. So, how do you prevent yourself from purchasing useless items that end up in your attic or basement eventually?
Create a budget
Creating a weekly or a monthly budget does wonders to your pockets. It pressures you to spend only within the budget and not go beyond it. Once you create a budget, it allows you to see what needs to be changed, such as that expensive coffee that you buy every day when you can make your coffee at home, buying that expensive bag because you can’t wait for the sale, and so on.
You can also act on important matters such as having a mortgage refinancing reading, paying less on electric bills by unplugging appliances not in use, and eating out less by cooking at home. Budgeting makes you realize how much money you have wasted.
Make Saving a Habit
Saving saves as your safety net in times of need. Of course, you can’t predict what will happen in the future—accidents, being laid off at work, being kicked out by your landlord, car crashes are prime examples of unpredictable events. You need to be financially ready when that time comes. You might not feel the weight of it now as you haven’t experienced it yet, but you’ll regret it when the time comes and you are not prepared. Open a bank account solely for savings, and don’t ever withdraw money from that account unless it’s an emergency.
Pay Your Bills on Time
Paying your bills on time saves you money. When a payment is late, you’ll pay for the late charges on top of the monthly bill. The money spent for the late charges could be used for your groceries, utilities, and savings. Instead, it’s wasted on what could have been prevented in the first place. Set a reminder for all the dates that all your bills are due to prevent forgetting about them. Write them on your desk calendar or your phone calendar.
Set Financial Goals
Financial goals are what motivate you to save money. Your financial goals could be saving up for a vacation, paying off college debt, starting a business, or being financially secure. List down your goals, or better yet, create a mood board with pictures of your goals so you’ll be constantly reminded of the path you are treading on. Financial goals are important because they serve as a direction of where your money is going.
Now, setting financial goals is as easy as one, two, and three. But what makes it challenging is sticking to it. You can get blindsided by temptations and squander your savings in the end. You should set strategies for sticking to your financial goals to ensure you stay on track.
If You Can’t Afford It, Don’t Buy It
This is the most common advice we hear from our mothers. We heard them before when we wanted that pair of brand-new shoes that are way out of our mom’s budget, and we hear them now as adults when we want to buy that brand-new car. You don’t have to force yourself to buy that item you can’t afford just because you see someone buying it. Don’t give in to pressure. Remind yourself of the financial goals that you set and stick to them.
Invest in Insurance
Like your savings, insurance acts as a safety need in times of need, too. There are several types of insurance that you can avail of according to your needs. You will be assessed according to your needs and monthly income to identify how much you should be paying every month. With your insurance, you won’t have to touch your savings in case something happens. They remain intact, full, and your financial goals will still be met.
We are surrounded by temptations all the time that it’s difficult to save money. A newly opened restaurant nearby, a limited edition bag, a new pair of shoes, and a new gadget are enough to entice us into spending. And this is not good if we want to save at the end of the day. Aside from self-discipline, we also have to surround ourselves with like-minded people. They will constantly remind us of our goals if we ever stay out of line.