Baskadia

Saving money is simply setting aside part of the money received today for future use. Money plays a very vital role in our world today; therefore, it is only right to learn how to manage it, save it, and make calculated financial decisions. While a few people find it easy and natural to save, saving money has proven to be a challenge to most. Statistics show that 38% of Americans don't contribute to their monthly savings account, and 68% have less than $1000 in savings.

Are you among the statistics who struggle to save or those who have zero savings, and you want to take control of your finances, save for retirement, or buy a house, car, or even a cellphone? This article will help you understand why you need to save and how you can start.

Why Should You Save Money?

To truly make a change, from spending all your paycheck in the first week, to saving a considerable amount of the paycheck, you need to understand "why you should save money" and deliberately wire these reasons to your subconscious through your brain until your brain begins

to give you a million and one reasons why you shouldn't part with that money in your hands, each time you want to spend. To break an undesirable habit, and create new, healthy ones, you have to tell your brain compelling reasons why the new habit is beneficial.

Here are some reasons why you need to save:

1. Saving money will help improve your life: having a little extra cash in your bank account will not only help you begin your journey to financial freedom but will also help you improve the quality of your life. Studies have shown that people who save money live more happy lives, have peace of mind, and even sleep better at night than those who do not.

2. Reach financial goal: whether your financial goal is long-term (retirement plan) or short-term (to buy a cell phone), saving money is the first step to your financial freedom.

3. Reduce stress and anxiety: in a world of uncertainties, having an emergency fund to cushion unexpected life events will help you reduce stress and anxiety.

4. Sense of stability over your future: having a little extra cash stashed away in your bank account will give you a sense of control and readiness for the future.

5. For financial independence: when you start to save, you increase your chance of eliminating high-interest charges on debt and benefit from interest payment on cash saved with the bank.

6. Inheritance for loved ones: "A good man leaves an inheritance to his children's children." Rather than leaving debts behind for your loved ones, saving can help you leave behind properties and resources.

How to save money

Here are ten useful saving tips that can help you get started

"start saving money today."

1. Plan your expenses: don't start spending that paycheck until you have drawn out a plan. Make a list of your needs and monthly essentials, and hold back from buying things you can do without (a new dress, shoes, handbag, your favorite candy)

2. Use the 40:30:20:10 rule: this rule states that 40% of your income after taxes should go to your needs such as food and housing, 30% should be assigned to paying off debt and any other dependents obligations you have, 20% should be solely for saving, and 10% to a charity or religious organization. Following this rule might require you to cut back non-essentials and cancel unused subscriptions or memberships but it is a sacrifice worth making.

3. Use the 30-day rule for spending: ever walked by a store and felt the urge to buy a beautiful dress that caught your eye, only to realize a few weeks later that you didn't need the dress and would have been fine without it? That is impulsive spending. The 30-day rule states "Before buying something that isn't a necessity, wait for 30 days, if you still want the item with the same desire as you did the first day, and you can afford it, then go ahead and buy it. This rule helps you stop impulsive spending and become a mindful spender.

4. Cook your meals: research has shown that eating homemade meals is cheaper than restaurant spending. I tried this and realized it's true! Homemade meals also mean a healthier meal, which implies lower medical bills when compared to eating out.

5. Try a no-spend month: trying a no-spend month will help you lower your monthly expenses to only the most stringent needs. Learn to look at the things you want and intentionally walk away from them. You will realize you are still fine even after walking away.

6. Stay away from credit cards: credit cards work against your savings goals, discourage self-control, and your plan to spend according to budget.

7. Set savings goals: set savings goals and write them down. Reviewing your long-term and short-term savings goals will help you stay focused.

8. Open a high-interest savings account or retirement account: open a savings account and set up automatic transfers between your checking and savings accounts.

9. Review your savings progress: Watching your savings grow will help you stick to your savings plan.

10. Resist the urge to impress: to achieve your savings goals you have to save the big win for later. Resist the urge to impress with little things like a new handbag, shoe, and dress, and be ready to impress with much valuable things like a new house.

Key Takeaways

There is always a way to save more money. Take a walk around your home, make a list of those things you spend money on, and think of how you can cut cost on them – using cost-efficient bulbs, shopping at discount stores, buying in bulk, proper maintenance of gadgets to save you cost on repairs, carpooling with friends, unplugging unused electronics, and many more.

Start saving money today!