Savings are something we should all have. They should be something we should all be responsible for from the time we start earning. Unfortunately this is not something they teach us at school, and sometimes we can’t even get this education at home. Unless we are self learners, saving may appear like a difficult task. But it isn’t, we are all capable of saving a portion of our income irrespective of its size.
Regardless of the economic situation, people should have savings in the bank, of course this can be more difficult to achieve if you have debt or bad spending habits. Both can be eliminated. To grow your savings here’s what you should do.
Eliminate debt
The worst thing to have is debt, it ties you down and constricts your life. You are unable to buy the things you want, travel or live without the worry that a repayment is around the corner. The less debt you have to repay the more money you have to allocate to your savings account. That doesn’t mean that you should put all your money towards debt and only after it’s paid off start saving. That puts you in the position where you don’t have any emergency funds, make sure that you put away a little bit every week even whilst you’re repaying your debt.
Limit your spending
The more you spend the less money you have to save. Of course you don’t want to be depriving yourself of all of life’s simple pleasures that cost a little bit, but you want to be saving enough to make a difference. The key with limiting your spending is to set a budget and be realistic about your saving goals. Shop with a list, pay your bills on time, cancel unnecessary items like cable television, unused gym memberships, and magazine subscriptions.
Automate your savings
Set up your bank account so that the day your pay enters your account, the bank transfers a set amount to your savings account automatically so you don’t even have a chance to miss it. The first couple of months might be tough, but within a few months you won’t notice the money is missing. If you get paid with cash, which does sometimes happen, automating your savings becomes a little more difficult. However, this should not stop you from putting a portion of your pay away. Make sure the first thing you do is put a percentage of your income from each pay into a savings account wherever you keep your savings.
Find a hobby that pays
If you want to accelerate your savings further, it might be an idea to see if you can make some extra money from your hobby. Every dollar extra adds to your savings balance. If you don’t have a hobby that pays, you can try and get a job, tutor Maths, teach a second language or wait on tables at a local caf or restaurant.
By putting money away regularly from every pay check, your savings account will continue to grow at a quick pace. Savings really is that simple. A few small steps and you’ll be on your way to having a savings account with enough to do what you love and buy what you want, without worrying about paying bills or reducing debt.