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Saving money, even for those who are earning high salaries, is not an easy task especially as it is easy to waste money on impulse-buying and other frivolities.
The information site Experts Column said any person can save up for the long haul once they identify the difference between "wants" and "necessities."
The site identified necessities as:
- Rent or house payments
- Insurance for home and car
- Health Insurance and other medical expenses
- Credit Card payments
- Home Maintenance
- Groceries (Food, Supplies)
On the other hand, "wants" are everything else not included in the list that you can live without.
Once you have identified and divided your wants and necessities, the next step to do is to have a solid plan of action for saving.
Experts Column issued the following tips to make one's money grow:
(1) Go for the cheaper alternative.
To minimize expenses, try cheaper products. There’s always a brand leader and a new product. If you feel that there isn’t much difference, you could go for the latter.
When going to a nearby convenience store, you could walk or use a bicycle instead of using your car to reduce your monthly gas consumption.
(2) Buy affordable yet sturdy products.
Quantity doesn’t always mean quality. Make sure that you always purchase a product that will last because replacing a constantly broken item will surely affect your savings.
(3) Live a simple lifestyle.
Being simple is the way to go especially if you have a limited budget. Don’t eat out everyday and bring packed lunch instead. Try out free entertainment such as museums and park concerts.
Meanwhile, the information site About.com, a New York Times company issued the following tips for saving money:
(1) Learn to live within a set budget.
With budgeting, you can assign every dollar (or peso) to a category that you control. Your money then ends up doing what you want it to do. This gets you closer to reaching your financial goals.
(2) Get out of debt.
Having debt is never a good idea when you are planning to save. It doesn’t just limit your saving capacity but also affects how you spend your money in other things and this burdens the budget.
(3) Save aggressively.
Once all debt has been cleared, you can now focus on saving. Remember to deduct your expenses from your budget and not from your savings. If you do this right you will be amazed at the rate that your savings grow.
The information site E-How.com offered the following money-saving tips:
(1) Set up ‘self taxation.’
The rule for this discipline is to give a certain percentage back to your savings for everything that you buy. The usual rate is 10 percent but if this is too high then you can always lower it to 5 percent or whatever feels comfortable “taxing yourself” with.
(2) Immediately set aside a percentage of your salary.
Using bank services which automatically deduct – say 10 percent – from your salary and put it directly to your savings account each payout will ensure that your savings grow. Just make sure you don’t touch your savings account except for emergencies.
(3) Be patient.
As with anything, patience is key in saving up for the future. This is not something that is instant and occurs overnight, it’s a long process that will span years. It would be best to keep your savings at the back of your mind to avoid over thinking about its amount. - VVP, GMA News