The hardest part about setting money aside and saving is getting started. To get started you need to make sure that you develop a realistic plan. You need to know that it is possible to save for both small and bigger goals in your life. Follow these simple tips to get started on your savings or to boost your savings balance.
Record of expenses
In order to save money or boost your savings, you first need to know exactly how much you spend and what you spend it on. To get started you need to take a month to jot down all of your expenses. Yes, this means every coffee to go, every lunchtime snack and every odd treat for the children. Once you have all the data you need, you’ll have put those expenses into categories such as household, travel, luxuries.
Time to Budget
If you know what you are spending every month, you can easily organize everything into a working budget. The ideal budget will measure up what you spend on what and compare it to your income. This will allow you to set money aside for the little luxuries without overspending. When setting out your budget you need to make sure that you take into account expenses which occurred regularly but not every month.
Plan for Saving
During the planning process for your budget, you need to make sure that you allocate a category for savings. Start off saving just R500 of your salary and build it up to saving 15% of your income. If you find that your expenses are too much to save even R500, then it might be time to consider cutting back on what you spend. Over time you should be able to think of the money you are saving as a regular expense in your budget.
Aim at Something
Saving and the ability to boost your savings is easier when you have something to save for. Start off by aiming for something you really want, a wedding, a weekend break or even new tiles for your home. Then start thinking of bigger things like retirement. Short-term savings goals are usually set for between one and three years while medium-term goals can take four to ten years of saving. Long term goals are those you save over 10 years for.
To make savings easier set up an automatic debit order every month to your savings account. This way saving will become a habit similar to a clothing account debit orders coming off your account.