How to save money effectively

how to save money effectively How to Save Fast: 17 saving money tips to See How Your Money Grows

Whatever your goal, these tips will make you save faster and faster.

These 17 tips to save quickly will help you achieve your savings goals in a jiffy. Although saving can seem boring, there are methods that allow you to save according to your to save money effectively  And not only that, but it will also help you visualize a happier future, make ends meet, and increase your general well-being. So, if you’re wondering how to save fast, we bring you these 17 tips so you can see your bank balance grow like foam.

Before you can save every month, you have to be aware of what your duty is and your assets. That is, evaluate all your income and expenses, which include your credit amortization installments, your monthly bills, and your savings contributions. Let’s analyze them step by step.

1. Learn how to manage yourself and understand how your personal finances work.

The most effective advice for saving quickly is to learn how to manage yourself. If you stick to a budget, you will take charge of your finances. Financial independence is essential to achieving your short- and long-term financial objectives. Here’s how to manage your money to start saving quickly:

  1. Keep track of your personal finances for 30 days (including all your income and expenses).
  2. Compare your monthly income with your monthly expenses to evaluate how much you are managing to save or how much you are spending each month.
  3. Divide your expenses into fixed and variable expenses. Your fixed expenses are usually the ones that are difficult to adjust, such as, for example, rent and consumption bills. Your variable expenses are the easiest to adjust, such as shopping at the supermarket, leisure, and service subscriptions.
  4. Identify those variable expenses in which you can make cuts, i.e., unnecessary expenses, to increase the amount of money you save every month.
  5. Evaluate your progress regularly and make adjustments if necessary. If this seems overwhelming to you, there are a lot of financial management apps that can help you stick to your budget.

2. Amortize your debts

Before you start saving, you will have to pay off your outstanding debts. The longer you delay the payment of your debts, the higher the interest that accumulates over time. Therefore, the savings you manage to collect will have to be used to pay your debts. So, before you focus on saving for other things, make the repayment of your debts your priority.

To do this, we propose the rule 50 30 20. Rule 50/30/20 was created by U.S. Senator Elizabeth Warren when she was a Harvard professor specializing in insolvency and offers a simplified method for amortizing debts. This is how it works:

  • allocate 50% of the income to your needs, that is, your fixed expenses (e.g., the payment of rent and consumption bills); allocate 30% of the income to your whims, that is, your variable expenses (e.g., eating in restaurants and subscribing to services); and allocate 20% of your income to your savings. For example, if you earn €2,500 net per month, you can set aside €500 every month. In just one year, you will have amortized €6,000 in debt.

You can use our calculator to simulate how to save with the 50-30-20 rule.

3. Open a special savings account.

To save quickly, you will have to separate the money you spend on your daily needs from the money you want to save. To do this, you will need a special savings account. In this way, it will not be so easy for you to fall into the temptation of resorting to your savings to cover daily expenses. In addition, this will encourage you to stick to your daily budget, as it will keep your savings out of reach!

4. Automate your savings

If you have a fixed monthly income, you can automate your savings contributions every month. To do this, you must set up a monthly automatic transfer from your current account to your savings account; this can be done with spaces in your bank account. By automating your savings and doing an expense control, you will reduce the possibility of using this money to cover your daily expenses even further.

5. Automate your invoices.

Now, it wouldn’t hurt if you automated the payment of your bills. how to save money effectively Companies usually charge fees for late payments if you do not deposit the money within the deadline, so paying in advance will save you more unnecessary expenses.

6. Set a spending limit on your card.

Do you want some practical advice to save quickly? Limit the amount you can spend with your credit or debit card. This will prevent you from spending more than you have and will encourage you to check your daily expenses. Many banks offer this service. You can set daily spending limits and decide whether or not to allow ATM withdrawals.

7. Use a personal management system with envelopes.

Another infallible trick that will help you save quickly is Dave Ramsey’s envelope management system. It consists of withdrawing your monthly income in cash from the bank (up to the last penny!) at the beginning of the month and dividing it into independent envelopes that correspond to your savings goals.

In this way, you will have envelopes for your fixed expenses (e.g., rent, consumption) and envelopes for your variable expenses (e.g., clothes, eating in restaurants, shopping). If you pay all your expenses with a fixed amount of cash, it will be practically impossible for you to get out of the budget. Don’t forget to have an emergency fund that saves you from extreme situations.

8. Trim the rent.

Saving on rent is one of the fastest ways to start optimizing your expenses. If you currently live alone, one of the easiest ways to achieve this is to share an apartment. This will divide the rent by two, and if you decide to live with two colleagues, you will pay a third of what you are paying right now.

For example, if you currently pay €1,300 per month for a three-bedroom apartment and add an additional partner, you will save €650 per month. If you decide to live with two people, you will save around €870 per month, which is almost €10,500 per year!

If you already live in a shared apartment, you can consider switching to a smaller room. Rents are usually calculated based on the size of the room you occupy, so you can save yourself some money each month. What’s more, this may also encourage you to be more minimalist, for example, by selling things you don’t use to earn extra money.

9. Cut out the consumption bills.

Another fantastic tip to save money quickly is to cut your consumption. Your electricity and gas bills represent a large percentage of your fixed monthly expenses, so if you can reduce them, you may save yourself a good pinch. We explain how to:

  • Change the energy supplier. If you are looking for the cheapest rates on the market, you can save hundreds of euros a month on gas or change your lighting for LED bulbs. LED bulbs are not only 75–85% more efficient than conventional ones but also last between 15 and 25 times longer; invest in a smart thermostat. This device will adjust your heating intelligently, and you can save yourself a good amount by sealing air leaks. Leaks in doors and windows can increase your electricity expenditure since your radiators have to run longer to heat the rooms. To solve it, seal these leaks with self-adhesive tape, which will prevent hot air from leaking.

10. Find a second job.

If you really want to boost your monthly savings, it’s worth looking for a second job. You can work a few hours at night in a bar or restaurant after your work in the office, work as a freelancer, become a virtual assistant, or even be a pet babysitter.

If you can afford it, it may motivate you to deposit all the money generated by your second job directly into your savings account. But be careful—don’t end up burning yourself. Your mental health is much more important than achieving your savings goals!

11. Cancel subscriptions that you don’t use.

Subscriptions are a money-making machine for many companies. And it often happens that, when a customer subscribes to your service, he is usually reluctant to cancel his subscription, even if he almost never uses it.

This is due, in large part, to the fallacy of the sunken cost. Applied to a subscription to a service, the fallacy of the sunken cost means that canceling a subscription that we rarely use is difficult for us because we have already invested a lot of money in it. Therefore, canceling the subscription would mean accepting that, until then, we have been throwing away the moneyhow to save money effectively . But, by postponing the cancellation of the subscription, we feel that we still have the possibility to take advantage of it. However, in general, few of us make the most of subscriptions. Therefore, it is much cheaper to cancel subscriptions that we do not use now instead of waiting for a hypothetical moment when we will take advantage of them.

12. Try to be more handy.

A fantastic way to save money is to try to fix things that break with your own hands. Thanks to YouTube and the internet in general, you can learn how to fix almost everything online. From leaking pipes to a broken zipper on your jeans, it’s always less expensive to fix them yourself rather than hire someone or buy new ones.

13. Think twice before squandering.

Falling into the temptation to satisfy a sudden craving is one of the biggest obstacles to saving.Give yourself at least three or four days to think about a big purchase.
This manner, you may avoid being ruled by your impulsive brain, which needs the serotonin the purchase provides

If you want to challenge yourself to save money, try avoiding buying anything big for 30 days.
Thus, you can reduce impulsive purchases and have time to find lower deals.

14. Buy the car by the end of the quarter.

If you want to buy the car at a good price, the best time is usually at the end of March, June, September, and December. Why? because most dealers are given quarterly sales targets in order to obtain their sales commissions. Although these objectives are set weekly and monthly,how to save money effectively  large commissions are charged every quarter. Therefore, they will be more likely to give you a good price at the end of the quarter since the dealer will want to reach their quarterly sales goal.

15. Trim your supermarket purchases.

If you manage to save on your grocery shopping every week, you will be surprised at the amount of money you can save over a few months. One of the best ways to achieve this is to plan your meals in advance. That is, calculate exactly how much money you will spend before making the purchase to reduce the possibility of going over budget.

Another piece of advice is to avoid eating meat on one day per week. how to save money effectively Since meat is usually more expensive than vegetables and vegetable productshow to save money effectively , it is worth choosing one day a week to do without it. These small weekly savings are noticeable over time.

Also, check the lowest shelves to save money.
Supermarkets arrange the most costly products at eye level to make you spend more, while the cheapest products are closer to the ground and go unnoticed.

16. Choose a day without expenses every month.

Choose a day a month to spend nothing except your set costs to make saving a habit.
This can include cooking all your meals from scratch, conversing at a park or at home, and spending an afternoon reading or watching TV
You can do it twice a month or once a week after you become used to it.

17. Sell the things you don’t use.

To foster the circular economy and save money for your vacation, sell your unused items on eBay or Nextdoor.

That will help you arrange your home and earn money to save!!

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