Tips on how to save money.

Sometimes the hardest thing about saving money is getting started. One need to be disciplined, determined and have self-control in order to be able to save adequately. This article will provide you with the step by step guide to develop a realistic plan to save for short or long-term goals.

1. Keep track of your expenses.

    Periodically, preferably first day of a new month get the receipts of all the purchases made in the previous month and stack them in categories such as groceries, bills, personal expenses  as this will enable you to see clearly where your money is going.

2. Spend wisely.                                                  

    You should endeavor to avoid spending money on frivolous items that are not really important at that particular time. Do ensure you also unsubscribe from marketing emails to the store you do purchase your items to avoid the temptation of going to purchase the items frequently without the need for it.

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3. Budgeting.

    Prepare a standard list of all the important expenses for the month. It should state how your expenses measure up to your income so you don’t spend above your income . Be sure to also factor in expenses that come frequently and those that occur once in a while.

4. Have a short time savings goal.

     Having a specific amount of money you save every week or month as this helps you to save longer and acquire more money. People tend to save more when they have a short time goal as this encourages them and relieves the burden of having to save a huge amount of money at once.

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5. Save money efficiently.

    Don’t just save money, save the money. This might sound illogical but it’s the fact. You could be saving money by spending less or buying less food at the restaurant but you still use the saved money to buy frivolous items. Instead, put the money you've saved in a bank for future expenses as it could come in handy anytime.

6. Balance your expenditures with your income.

    Take the cost of the item you are currently purchasing and divide it by your hourly wage. If it’s a $80 worth of item and your hourly wage is $10 per hour. You need to ask yourself if that item is worth 8 hours of your time. You should check my post on why you shouldnt be obsessed with money.

7. Choose what to save for.

    One of the best way and easiest way to save money is to have a particular thing that you want to get or achieve with the money you are saving. It could be a short time goal such as educational fees for the kids or car maintenance. It could also be long term goals such as retirement, vacation and so on. The most important thing is whatever you are saving for should be worth it.

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8. Introduce the 24 hour rule system.

   This rule helps you not to spend extravagantly or buying unnecessary items on impulse. Think of all the unnecessary items you want to get and avoid buying them. It is much easier when shopping online because you can always add the item to the wish list or cart and come back to them days later.

9. Automatic savings.

   This method helps a lot because it keeps the excess money out of sight and mind. At every end of the month have your employer deduct some amount of money from your paycheck and transfer them to your savings or retirement account. You could also discuss with your bank staff or your HR representative to help you transfer a fixed amount of money from your checking account to your savings account.

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10. Envelope budgeting.

      If you have trouble with overspending or you find it difficult controlling yourself, try the envelop budgeting system where you put some fixed amount of money in an envelope for a particular purpose and once the cash is gone, it’s gone. Please leave a comment and subscribe to our blog via email for daily updates.