Five Easy Personal Finance Tips!
Use these tips and start saving today
As money goes increasingly digital it seems like it’s getting harder and harder to save. Swiping a card doesn’t feel like as big of a deal as physically handing over piles of money to someone. It’s so easy to lose track of how much you’re spending it’s no surprise so many people are stressed about their finances.
If you’re willing to put a bit of effort and willpower into it, though, you’ll find you can still save a lot of money you never knew you had. Here are a few tips to get you through:
Use cash to track your spending
As we said in the introduction, handing hard cash to someone is a much bigger deal than swiping a piece of plastic through a card reader. Getting cash out for your weekly expenses like groceries makes it a lot easier to see how much your spending.
Basically it’s a good way to create a budget you can stick to: get out a certain amount of cash on pay day and stick to that as much as possible until the next pay. You’ll find yourself a lot less willing to buy things you don’t need when you can feel the weight lifting in your pockets.
The other benefit to using cash is:
Save your change!
You probably had a piggy bank of some kind when you were little, so where is it now? Pennies and nickels never seem like much, but keep a hold of every single one you get back as change and see how much you can save in a few months: you’d be surprised.
Even if it only works out to a dollar a day in loose change, that adds up to a week’s groceries once every few months you don’t have to worry about, or a trip to the movies with the family you couldn’t spend the money on, or a nice dinner with your partner.
Some won’t think that’s much of a return, but for those who’ve ever truly worried about money they’ll know that little grace period or one-off luxury can mean the world of difference. Every penny adds up, so keep hold of them.
Track all of your purchases
Another good way to stick to a budget and monitor your expenses, whether you’re using card or cash, is to keep a running track of your purchases. You’ll be able to see where money is disappearing that you never realized — those small purchases it’s all too easy to be dismissive of.
There are really two ways to do this: use an app, either on your phone or online, or do it manually. The former is obviously more convenient, but not everyone can afford a smart phone or reliable internet access.
Manually tracking your expenses is simple, but time-consuming. Get a receipt every time you buy anything — and we do mean anything — and at the end of the day compile them into a running total. You’ll start to see how buying a $3 coffee every day, for example, is actually a major drain on your money over the course of a month.
Buy in bulk for common things you use
This is a really common piece of advice, but still a hard one for a lot of people to follow. When you’re standing in a shop faced with buying one item for $1 or fifteen of that item for $10, it can be easy to get swayed by the price rather than the volume. In your head you’re saving yourself $9 by going for the first option, but you’ll lose out in the long run.
On the flip side, it’s important not to buy something in bulk that you don’t need. Toilet paper or tinned food, for example, is always appropriate to buy in bulk. Thirty bottles of ketchup, on the other hand, is rarely a necessary purchase.
If you combine bulk buys with clever couponing you can stretch your volume-purchase savings even further — in some cases, it’s even possible to buy the bulk item for less than the single-unit cost.
Buy quality over quantity
It might sound counterintuitive to someone trying to live a frugal lifestyle, but sometimes you do need to buy the more expensive item.
This follows on from the bulk buying advice and is the hardest thing when you’re trying to save money, but probably the most important. If you need a good pair of shoes, for example, wait and save for it. Don’t get a $5 pair that looks okay: they’ll fall apart in a few weeks and you’ll need to buy another pair. By the end of the year you’ve probably bought ten pairs, while the person who spent $50 won’t need to get another for years.
Things that rely on quality to last, things that get used a lot and have a tendency to break with wear and tear, are the things you really need to save for. It’s hard. Use those pennies you’ve stashed in your piggy bank, use your coupon skills, search online for the best deal in the world, just don’t go for cheap if you can help it. A single good pair of shoes can last a long time: a dozen bad pairs of shoes may last a year.
If you’re desperate for those items at short notice, then obviously there’s not much you can do. But wherever you have the chance, save that bit extra for the quality and save yourself in the future.
Long-term financial stability and saving starts with short-term changes in behavior. It doesn’t take much to get started, only that you actually start. The rewards might seem small at first, but within a few months you’ll start noticing less and less stress on your bank balance. Start small. Start today.