Saturday, May 09, 2009

Smart Saving Tips

Save 10% every day!

It’s a basic idea. If you remember to reduce ten percent on the quantity of things you use everyday, you’ll find you are spending less every day. And this will show in your bills, your grocery bills, and overall in how much you spend every month.

The small quantities add up to save you money.

Imagine, 10% less oil while cooking (good for your heart, anyway), less soaps and detergents, less electricity (turn off the AC, switch off lights, switch on the water heater just for a few hours before shower time)

Simple actions like doing laundry at home when possible may save you money every week as opposed to taking all your clothes into a dry cleaner.

Make less trips using your car, by planning trips ahead of time – and you’ll see major savings at the petrol station. If you have two cars, and one is a big SUV and the other a small run around, use the smaller car that consumes less fuel when possible.

Saving as a habit

You need to make savings a regular habit. Instead of saving whatever is left over at the end of the month, plan on saving – which is paying yourself – first. Set aside the amount you plan to save first before you start spending on everything for the month. Plan on this with your family, and this can be an exciting way to get everyone involved, once you have explained the benefits of saving money.

Making a budget

In order for you to make a regular savings plan and make a habit out of it, it’s best to sit down and prepare a budget – so you know exactly how much you want to spend, on what, and how much you want to save. A pre-planned budget will help you in allocating your spending and controlling on sudden bursts of unintentional spending.

Have a Savings Goal and meet it

"Don't save what is left after spending; Spend what is left after saving" - Warren Buffet

The best way to figure out how much you want to save is to set specific monetary goals. If there is a specific thing that you are saving up for, start by calculating how much you will need to save in order to pay for it. Next, figure out how much money you will have to set aside each month in order to reach that goal in a reasonable amount of time. If you are saving for something with a less specific monetary value (such as money for an emergency fund, your retirement, or just a healthy nest egg), then you should try and come up with a figure to shoot for (i.e. Financial experts often recommend having enough money in an emergency fund to cover at least 3 to 6 months worth of household expenses).

Take advantage of the downturn?

Yes, you can. There are a lot of retail outlets and shops that have reacted to the downturn in the economy by offering special sales incentives. You can get discounts on many every day items and as well on some electronics and white goods (washer/dryers, fridges, ovens etc). If you have an immediate need for any of these items, this would be a good time to purchase them – while they are on discounted sale.

Simple economics: every day, every week, every month.

Eating out and treating yourself is fun, and once in a while, it’s a good idea. But a quick and easy way to curb your spending – and start saving – is eating out less. Try eating in more often and packing yourself a lunch for eating at work. Besides saving money, making your own food can often be healthier too. You can save a lot by eliminating that expensive coffee latte habit. You can save on unnecessary and unused magazine subscriptions, tv channels you pay for but don’t watch, phone related expenses. These are every day things you can either curb or totally cut down on. And yes, they add up to your savings.

Interesting Videos: Money Spent is Money Earned