In today’s consumer world, we are constantly bombarded by ads, sales pitches, and media pressure to dress according to trends and buy what is fashionable. It is easy to cave to these influences without thinking about the impact your purchases have on your finances. But, by spending less you can save more money for your future.
Planning for retirement is something everybody should start doing early in life. If you are in your 30s or 40s, you may feel like you don’t need to think about it because retirement is in the distant future. But, the earlier you start saving the better off you will be.
Even if you aren’t worried about retirement, it also takes planning to save for a new home, for your children’s education, or for any number of other major life purchases. Controlling spending habits is one of the most important things to do if you want to reach these goals. Here are five useful tips to help you tame the consumer within and save more money.
1. Think before you buy
Avoid spontaneous spending and stop to think before making a purchase. Before making big purchases, take a break from shopping to have a cup of coffee or go on a walk, and use that time to consider whether you really want to go through with buying the item. Here are some questions to consider before making a purchase:
Do you need or just want the item?
If it is something you need, is it more expensive than acceptable alternatives?
If it is something you want, stop to think about whether it is worth the cost. Can you really afford it?
Think about how many hours you needed to work to earn the purchase price.
Think about what else you could buy for the equivalent amount, and whether that might make you happier. Be selective and smart about your discretionary spending.
If you have to move some day, will you take the item with you or throw it away? If the answer is the latter, think twice about the purchase. It may be a trivial item that you don’t really care about in the long-term. Asking yourself these questions before you spend will put things in perspective and help you make better spending decisions.
2. Create a schedule for your routine spending
There are certain things you need to buy on a regular basis. Make a plan for this routine spending. Have a grocery list prepared and plan your clothing purchases ahead of time. Don’t go shopping without a plan; and don’t ever go grocery shopping on an empty stomach!
3. Figure out what works best for you between using cash or credit cards
Some people prefer to use cash because it helps them spend less to actually see the money leaving their possession. Other people find it easier to spend cash, and use a credit card to help control spending. As long as you are paying off your credit card on a monthly basis, this is okay to do. Figure out which works for you and stick to it.
4. Create a Budget Create a budget and stick to it
By creating a budget, you can see what you may be spending too much on. Ideally, you should be putting at least 15% of your income away in savings for the future or more. Here are some rule-of-thumb expenditures as a percentage of your salary:
Life: 25%
Housing: 35%
Transportation: 10%
Savings: 15% or more.
Advisably as much as you can. Loan repayment or child education (which can also be part of a savings plan): 15%
Make sure you review your spending regularly to make sure you are spending within your budget.
5. Have and stick to your savings plan
Become disciplined about purchases. Always plan your routine spending ahead of time, and stick to your budget. Sacrifice other areas of spending before you stop putting money away in savings. None of your hard work will matter if you allow yourself to collapse in moments of weakness.
It is very important that you remain strict and loyal to your savings plan. Your future depends on it. That is why it is better to have a regular savings plan where you are committed to putting aside the chosen amount. This will force you to first put the money aside for future and only then spend the rest, leaving you secure and in a much better financial situation from the start.
Secure Savings Plans Available on the Market
We are all worried about the risk when investing and putting money into programmes that do it for you. But what if there was a savings plan that would provide a protection on your capital?
At CrewInvest we specialize in retirement and savings solutions that guarantee no loss of capital and earn a fixed interest rate annually. We provide regular contribution plans and lump-sum (fixed amount) plans.
One of our new bond product allows you to choose your term of 1-5 years with fixed interest rate between 6% - 10% paid monthly to your bank account.
Our 15 year retirement / savings programme invests directly into the S&P 500 Index and will average 8.5% per year. The plan guarantees that your invested capital won't reduce in value. The guarantee is provided by HSBC.
Contact us for more information - info@crewinvest.net