Month of February: Savings Tips for Beginners
Many of us have a hard time getting a strong hold of our finances and as a result, practice unhealthy financial habits.
All of February we shared savings and budgeting tips with our Neighbors on our social platforms. Here are the top 8:
Live below your means
Create an emergency fund
Knowledge is power
Turn hobbies into a hustle
Wants versus Needs
Savings time periods
Try a savings challenge
1. Live Below Your Means
Simply don't spend money you don't have. Understanding how to save money is the first step to healthy money habits. Get rid of any unnecessary bills and set a financial budget to help manage your financial goals.
2. Create An Emergency Fund
Emergency funds are an important part of savings. Having oney set on the side for those unpleasant crisis. Save a minimum of 6-12 months of living expenses this allows time to deal with life’s emergencies and as well having your monthly expenses covered.
3. Knowledge Is Power
Just like any class you my take in class. Money is also a topic that has to be taught and understood. In order to understand how to budget and save money accordingly and in a healthy fashion we have to become educated in the subject. Education is the key to change. Here are three reads to get you started ,
How to stop living paycheck to paycheck- Avery Breyer
Personal finance for dummies - Eric Tyson
Your money your life -Vicki Robin
4. Turn Hobbies Into A Hustle
Take the skills you already have and turn it into a side hustle. With the money you make use it to improve and turn it into a business or add to your savings. Use the time you have free and turn it into something more productive
5.Wants VS. Needs
Push yourself to change the bad habit of excessive spending by differentiating your wants from your needs. Rite down the things that you buy because you need them on a daily or monthly basis versus things you may buy just because you have the ability too.
6.Savings Time Period
Establish the amount of money you want to save and then develop a time period for each goal. There are three different types of savings:
Emergency fund ( 6-12 months )
This fund is used for things like rent, grocery and quick emergencies that may arise
Short term (1-2 years)
This fund is for things you may want to use for in the near future like making a trip to another country. Making a down payment on a new house or simply save for a rainy day.
Long term ( 3+ years)
This sort of account you won't touch for at least a period of 3 years or longer.
It's important to have a basic understanding of the different types of savings accounts and how each one has a different purpose in our lives. Each one is designed to help you in the current, short and long term faces of your life.
7. Minimize Bills
Get rid of those unnecessary spending and control the lifestyle and watch your savings grown. Obvious ways you may lose money if through going out too much, not cooking atv home and ordering take out. Learn to recognize and catch your bad money habits and exercise better control
8. Try A Savings Challenge
Make savings fun and adopt a savings challenge as a way to better track your progress.
One of our favorite challenges is the 30 day challenge, by controlling your impulse buying and waiting 30 days you can determine your level of desire for the product. Waiting the 30 days allows your mind to process and rethink before making the final purchase decision.
Start with a tip you find easy to practice and try to implement it every day. You will find that as you progress these tips will become part of your lifestyle.
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