How To Start Saving Money Tips

money savings tips

I’m going to share  with you how I was able to save about  twelve thousand dollars in the past six  months and I understand this might not seem like a lot of money to some people by considering that the average millennial invest about seven point five percent of their total income. I like to think that this is something of a step in the right direction so follow along in this post, I want to share some tips and tricks and some strategies that I use to save more money. 

I understand it can be very difficult to actually save money the process of it thinking about it can be easy but actually doing it and seeing that money in your account piling up can be much more difficult easier said than done so.

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Step 1: Set Broad Goals

Now there is really three first initial things that we need to do before we even consider saving money and the first one is we need to set these overall kind of broad goals to  understand where we want to be twelve  months from now, five years from now and  twenty years from now.

Just general ideas of do you want to be a multi-millionaire or maybe you just want to have enough money to pay for family vacations. You just want to have a nice cushion of cash or investment saved up so that you’re not struggling to pay your bills. So decide where you want to stand there you want to be a billionaire, or you want to be Warren Buffett or do you want to not set goals as high because it’s important to know that so that you can kind of plan  for the future. Know how serious you have to be about saving money in order to reach those goals.

Step 2: Create A Personal And Monthly Budget

Now the second step is really crucial to actually achieving financial success and being able to save money effectively and that is by creating a very simple personal budget and a monthly budget. I have a free budget template if you’re  interested in using it or you could just create your own  on something like Microsoft Excel or you  can go old school get out a pen and a  paper and just start creating a budget. 

Write down all of your monthly expenses  and your total income on a monthly basis  and that way you can see where the  money’s coming in.  Whereas going out if you’re not measuring and calculating your cash inflows and outflows you’re going to  have a lot of issues.

Actually trying to save money if you don’t know what’s  going on and you don’t know where that  money’s going. You don’t know how much money you’re spending on food and how  much you’re spending on all these other  various expenses in our life.

It can  really pile up and really get ahead of  you. So you want to get ahead of this and create a budget and it’s a pretty simple step but it’s something that so  many people just neglect and they don’t do because they just are kind of lazy or  they just don’t feel like they need to do it. However, I’m telling you if you’re  trying to save the most amount of money this is how I went from saving almost  nothing to being able to save a lot more  money was by using a budget.

3. Breakdown To Small Goals.

Now the third step along here is to create more specific goals so you had those initial goals of where you want to stand financially years from now but  then you want to set these  secondary goals the ones that are more  short-term. This is where you can say you know what looking at my budget that I just calculated I may want to be able to save $500 a month or maybe $100 a month whatever you can afford maybe $1,000 a month and maybe $10,000 a month it depends on your  income and that’s totally understandable.  So be realistic with yourself maybe  start with small amounts and then maybe expand that as you go on as you get more  experienced with budgeting and making  smarter financial decisions but find out  where you can be for that budget.

For setting those monthly savings goals and those yearly savings goals, now there’s really five different what I would say essential needs of people that are very important to address. We are going to dig into each one of those five and the first one is food and then we have shelter then we have transportation, clothing and health. Those are really the five we’re going to dig into all five but really one of the biggest keys to actually saving money for myself regardless of anything else any other ideas that people might have mentioned in the past.

The one that was the most effective for me was by really implementing this super simple but so effective strategy and it was by setting up automatic withdrawals with my bank. So look what I have set up now is I have money flowing into one primary  account but I don’t really use this  account too much. It’s sort of like a shell account because after my income comes into this one account and then it gets distributed  through automatic withdrawals – varies  various other accounts so automatically 30 percent of my income goes directly into investments and savings accounts. So 30 percent gets thrown into there now.  I’m left with 70% to then use for the  cost of living to pay for my rent to pay for, my food to pay for, health expenses to pay for and any other expenses. That’s what that other 70% is in  you can decide this for yourself.

If you want to set this maybe one automatically withdraw 10% or 20% or more whatever you can personally afford out of your  budget that you already calculated previously. Then you can decide how much you’re  able to do but look I’m telling you this  is incredibly important to do because  with these automatic withdrawals you  want to set this up on the day that you  get your paycheck so the day that money  gets put into your account you have  automatically withdrawn 30% of that or  whatever percentage that you are able or  capable of doing.

Then automatically withdraws gets put into savings council or investment accounts, taxes whatever your heart might desire to put into something and then you’re left with a certain percentage to then live off of.  I don’t want to say trick yourself  into thinking that you have a certain income but the way that I like to do it is I then say you know what I’m not making X amount of dollars. I’m only  making 70% of that and I tell myself  look I have to live off of this and  disregard that other 30% it’s a great way to really save money and it’s hard  to go wrong with it in a lot of cases by using this strategy.

(a) Food

So there’s really five different needs that are pretty essential for most humans now within these five means there’s ways to cut  back on each of these categories we’re going to dig into these. The first one is food this is one of my favorite ones to cut back on. The reason for this is because food is one of the most depreciating assets you could ever imagine.

 I mean if you spend $20 on a meal, you eat the meal now there’s  nothing on your plate and there’s no value left over you basically could have  just eaten that $20 bill because that’s the effect that it has on your wallet so  cutting back on food cost can be really effective. There’s a various ways to do this stop eating out as much make your own food  and also consider buying products that are not branded but more so store brand  products. This can save you $50 a month, hundred dollars a month or more  depending on how much you’re spending at  the moment on food.  I love cutting back on food without depriving yourself of nutrients make sure you’re getting good food in your body and that is very important.

(b) Shelter

Now the next one is with shelter. The cost of shelter is difficult to avoid. One of the best ways to cut your cost of your apartment or your house in half is to get a roommate or consider renting out a room in your home through something like Airbnb to cut the cost of living for yourself. It literally cuts in half now. There’s also some other ways you can go about this if  you’re not interested in getting a roommate or you already have a roommate.  

You could consider cutting some utility costs like for example wi-fi or  electrical.  There’s ways to actually cut these costs and so most people think that there’s only one electrical provider or one wi-fi provider when  really you could look into various companies that are offering similar  products and shop around a little bit more. Just because you’ve been using the same provider for the past 10 years doesn’t mean that you shouldn’t look  into getting a different one because what happens and this happens with  other utilities as well.

(c) Transportation

Number three is transportation. Now this is one thing  that is very difficult to avoid as well. The cost of owning and  operating a vehicle is very expensive  especially if you’re racking up a lot of  miles on it people don’t always consider this like you’re paying for auto insurance you’re paying for the vehicle expenses you’re paying for gas you’re paying for all these different issues that might pop up with the vehicle you need new tires you need to get it inspected you need to get a new alternator and it runs up a lot of money. 

So look if you live in an urban or even a suburban area where there’s some type of  public transportation or even Uber. You might want to consider thinking whether or not it’s actually worth it for you to own a vehicle and how much you’re using that vehicle versus something like public transportation run those numbers.

 I  highly suggest that because cars or a money pit they’re difficult to avoid  especially if you’re in rural areas like myself it’s difficult to not have a  vehicle I did it for a while but  eventually I had to end up getting a vehicle but look if you can cut back. It’s going to help you so much now.

(d) Clothing

The next one is clothing. This is one that’s  very easy to cut back on the best way to cut back on the cost of clothing what I  found is to unsubscribe from all these different emails from clothing providers  that are giving you sales and discounts.  Look, email marketers are paid to do something that they’re very  good at and they’re very effective at it that’s why they’re still making money and they’re still sending these emails because they’re effective look when you’re getting those emails when it says 40% off sale of this clothing store. 

People end up buying clothes so what I did was to unsubscribe from all of those  different email providers and emails that I was getting and that way I  wasn’t tempted to go out and buy something because I got an email about a  special sale on something that I didn’t really need or want but ended up buying.  If you’re  really in a kind of an area where you need to start saving more money you’re on a tight budget, I would consider going to something like a thrift store or Goodwill or Salvation Army if you need to go to that.  I  think it’s actually really effective and and helpful to society because I feel as though people are very wasteful they buy things and they just throw them in the trash and end up in the landfill but with something like thrift stores you’re able to recycle clothing and it’s much less expensive as well so consider that as well.

(e) Health

The last one is health and health is incredibly important. The best way to cut back on this is to make sure you’re treating your body correctly health is one of the most important things in our life.  People pay a lot of medical bills  because they have medical  problems because they’re not eating  healthy and they’re putting terrible  foods toxins into their body and they’re not working out they’re not exercising  and it’s costing them a lot of money. 

Maybe not now but trust me 20 years from  now if you’re treating your body like crap right now it’s 20 years from now you’re going to have plenty of medical  problems so make sure you address that and think about that for the future. Just be good to your body be nice to your  body because hopefully I was able to give  you some different ideas for saving some  money this is what I personally did. If you have anything to add, please feel free to comment below!

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