Money Saving Tips
Managing money that we earn after long working hours, busy meeting schedules, sacrificing family time and forgetting ourselves is one of the major problems in life. The more we manage our money the more it becomes easier to spend retirement age.
I have listed some of the money saving tips that will help you save some cash and spend it later or book a relaxing trip for yourself as a reward.
1. Invest in cash generating assets
If you invest in cash generating assets they become you earning assets for the time duration they hold. You double your money after a specified time by investing in cash generating assets. Cash generating assets earn money for you. These items have low risk so it’s better to have them in your portfolio and use them at the time of need instead of taking out loans. You will have to bear high-interest costs if you take out loans.
Some of the best cash generating assets with low risk includes.
Certificates of Deposit:
You lend the bank money for a fixed amount of time and you earn interest on it along with the principal amount you lent at the end of the loan period.
In case of bonds, you lend money to the government. They guarantee return and are stable.
There are lots of other cash-generating assets but these are the ones that have no or low risks associated with them. If you want to invest in high-income assets you will have to bear high risk. These assets include stocks, real estate, shares and mutual fund investments.
2. Establish a budget
Prepare a budget every month listing all the assets you have and all the liabilities you will incur this month. It is better to list all the liabilities and calculate beforehand the amount of money you will need this month. This will restrict your spending and you will end up buying only the items you need the most.
First, find out all the income sources you have. Now determine your fixed expenses that you incur every month these include rent expenses etc. Afterwards, calculate all the variable costs these include your shopping amount grocery items cost etc. remember to put some margin in your budget for variable cost since they vary every month.
Always allocate some space for savings in your budget. I allocate 30% of the money I make every month as my savings and keep them in a separate bank account. You can save as much as you want.
There are lots of apps out there that could help you prepare your budgets and keep it safe in your cell phone or tablet. You can access it anytime you go shopping.
One of the best app for creating a budget is “Mint”. It gives you an alert you cross your budget and it is linked with various banks, brokerage houses, financial institutions and card issuers so that you can manage your money easily and see where it goes the most.
Another best app for budget creation is “PocketGuard”. It prevents you from overspending. It gets linked with all the financial accounts you hold and compare your spending with your budget all month.
“Wally” is the easiest app to create budgets as compared to the other ones mentioned above. This app also proves you with a screenshot so that you don’t forget your budget allocated and avoid overspending.
3. Make a Shopping list every time you go shopping
Don’t waste your precious time and money buying items that you don’t need right now or you won’t need in the near future. Do not buy items in bulk to get discounts if you don’t need them frequently. People mostly spend lots and lots of money buying stuff they don’t even need because they don’t make a shopping list.
Before you go shopping prepare shopping list of all the items you need. Sort the list with items on top of it that you need the most. Check all your wardrobe, closets, garage everything and then prepare a list of all the items that you really need. Stick to the list that you have made. Do not buy any item other than the one on the list even if they are on sale.
There are plenty of apps that you could use to prepare your shopping list. The best one is Evernote. It’s the best app to record your list as it allows to store data in the form of Pictures, audio or video along with the text. You can add reminders if you need something in future but not now. This app also allows synchronizing your data with other apps.
4. Only Bring the Cash You Need
Do not take your credit card ever when you go for shopping. When we take our credit card we end up buying items that we do not need because we know we can buy stuff with all the limitations we have. Card fee is also a lot and just a waste of money to spend.
It’s better to bring limited cash and stick to it. Complete your shopping with just the amount you have brought. When you have a limited amount of cash in the pocket you end up spending less and only buy stuff that you genuinely need.
5. Go for grocery shopping with full stomach
When we go shopping with a full stomach we end up buying fewer grocery items. Our mind doesn’t focus on buying additional stuff. Emotions affect our brain to a greater extent. If we are hungry or depressed we end up buying in bulk to satisfy our feeling. Shopping gives our mind a feeling of satisfaction that we do not get by doing anything else. Therefore, it’s better to go shopping after lunch or dinner.
6. Shop Out of Season
It is better to shop for clothes or items out of season because you will find clearance deals and the items will cost you far less than their original prices. For example, if you buy sweaters in summer time you will find the prices to be far cheaper as compared to the prices in winter due to less demand for the items in the market.
A lot of shops offers huge discounts on the items not in season or the items that are left over. Try to look for the shops that have a clearance sale and buy for the next season beforehand.
7. Buying in bulk for everyday items used
It is better to buy in bulk only the items that you need every day for example soaps, dishwasher liquid, detergents, lentils or any other nonperishable items to get benefit from bulk discounts. Do not buy perishable items in bulk as they need to be brought fresh.
8. Invest in an emergency fund and save for it
Every day takes some money out and saves it for an emergency fund. Like every day allocate a budget and save it in a locked closet do not take that cash out for everyday use. This collected cash will act as an emergency fund. Use this money in case of emergency so that you don’t have to take a loan at that time and bear high-interest costs.
If you avoid taking loans in case of an emergency you will save high-interest costs. That will itself save you a lot of money.
9. Sell items no longer used
We all have some items in our closet that we no longer need. These could be some decoration items, antique pieces, jewellery, books, video games, electronics or clothes. All those items which you no longer wear or use try to take them out and sell.
You can arrange a sale or auction in the backyard or garden of your home and advertise it. People will buy these items from you at half the price happily.
You can place an advertisement on ebay.com or amazon.com and advertise there. People mostly buy used items from these sites since they trust them. You can also sell clothes at the local market place. It is best to sell your old stuff first instead of buying new ones, again and again, every time and creating piles of clothes and stuff everywhere in the house. Items lose their market value if they are kept for a very long time so it is better to sell ASAP if you don’t need a certain item.
10. Make gifts and customized cards yourself instead of buying
Buying gifts and cards from a gift shop cost a lot. It is far better to design your own cards and go for handmade gifts instead of buying from a shop. You can design customized cards according to the taste of the one you are presenting. Readymade cards cost much then they are worth for. Designing cards yourself improves your creative skills and saves you money.
11. Cook food for yourself instead of buying outside
Cooking food at home cost less as compared to eating at fine dining restraints. You can easily prepare these dishes at home. All the chef secret recipes are now available on the internet, you can easily access the recipes and prepare delicious food at home to enjoy with your family.
If you prepare food at home you only have to incur the cost of the ingredients. But if you dine out they charge you an extra amount per dish for providing services. You also have to incur extra tax if you dine out especially if you dine at fine dining restaurants.
Save yourself money and tax charges by cooking at home and enjoy with your family.
12. Don’t buy more than you will eat
People usually end up more items than they want to eat. Always make it a rule to order less food than you need for lunch or dinner. Buy less grocery stuff than you think you will need this month. You can always buy stuff if you need it again but if you buy a large quantity than you actually need it will only go waste.
Avoid wastage by buying less stuff than you actually need. It will save you a good amount every month.
13. Check for Promotions and Coupons
Check for promotions, discount codes and coupons each and every time you make a purchase. Only buy items when you can avail discount on it. It is better to Join the store loyalty program to get some free points before you want to make a purchase.
Don’t buy an item just because it’s on sale. Only buy items on sale that you really need. You can save a huge amount if you apply coupon codes while shopping online. You can also save shipping cost by opting for nearest pick – up options.
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