What is your relationship with money like? Do you find yourself scraping to reach the end of each month, or are you savvy with your money? Learning how to save is the first step in taking control of your finances.
Start today and thank yourself later.
Note your expenses
Do you know how much you spend? Keep track of all your expenses, this includes every chocolate, all airtime and transport money that you use. Once you have your numbers, note how much you need to survive the month.
Create a budget
Now that you know how much you spend, record your expenses into a workable budget. Your budget should outline how your expenses measure up to your income, so that you can plan your spending and limit overspending.
After setting your budget, start to save 10% to 15% of your income. If your expenses are so high that there is nothing to save, then it may be time to cut back. You could start by identifying the non-essentials that you can live without or can afford to spend less on, such as going out. Remember, your savings should be included in your budget as a regular expense.
Set a goal
Saving for the sake of saving is not very effective but saving with a goal in mind is. Think about what it is you want. Perhaps you would like to save to buy a car, study further or travel? Figure out how much you will need, and how long it will take you to save for it.
Make saving automatic
Create an arrangement with your bank to automatically deduct your savings from your account. In that way you are less tempted to touch this money for your short-term needs.
Watch your savings grow
Now that you have hit the ground running, check your progress monthly. You may need to adjust, but one thing is for sure, you will be inspired to stay committed to your goal when you see how much you have or you may just identify other ways to reach your target quicker.
Written by Karabo Keepile