We all know that saving money can be a difficult task. But, starting small is the best way to save money. You will eventually be able to build up the amount you’re saving. Luckily, it will just become the norm to put away your set amount, daily, weekly or monthly.
Here are our top three favourite ways to begin or continue saving.
Elizabeth Warren created the 50/30/20 rule in her book – ‘All Your Worth: The Ultimate Lifetime Money Plan’. The book suggests that you should be spending 50% of your income on the essentials. They are things which you spend money on daily. The other 30% can be spent on what you want to buy, things which you don’t need like a new pair of shoes. The remained should be saved. This technique is designed to help you to reach your financial goals whether they be large or small.
Although, you are able to switch the ratio around if you think it suits you better or will work better in the long run. For example, you could save 30% of your income and spend 20% on what you want during that month. That will result in you saving more money throughout the year.
Record Your Expenses
The first step you should take when you begin saving is to look exactly at what expenses you have. It is best to record them so you can see exactly what goes in and out of your bank account and then work from there. Unless you’re spending hundreds of pounds a day, one of the easiest ways to record them is split them into a weekly or monthly chart and fill it in.
After doing this you will be able to easily see what comes in and goes out, meaning you can work out which things are essential and which things you don’t need. This could be cancelling some monthly subscriptions which you don’t use or even stopping your morning coffee trip to Starbucks. If you can visually see everything you spend, you will be able to understand what you’re spending more easily.
Saving Challenges / Saving Your Change
Why not try a saving challenge? There are plenty of different challenges and games out there for you to try which makes saving seem easier. One of the most common ways is to put all of your change into a jar. If you’re spending cash regularly you’re more than likely going to have a lot of change, so what’s better than putting it in a sealed jar and then opening the jar at the end of the year? Some people prefer to save specific amounts. This could be putting away every £2 coin that you receive. This way might be easier for you as it still means that you have some change which you can use. Or some other people like putting away the notes which they have, whether it be £5 or £10.
You should remember that saving money isn’t as easy as it seems. You might find our tips helpful and they might work for you, but we are aware that they don’t work for everyone. So, if you ever need some emergency cash, feel free to apply for a payday or short term loan with LoanPig.