No matter how difficult your financial situation is, there is always a way out of it. It won’t be a walk in the park but at least you’ll get positive results that can help turn your life around. You only have to find the determination and courage to take the first step and everything else will follow.
Here’s a list of some simple money tips. Try them out — at least once — and find out just how effective they are for you. Hopefully, you’ll find one or several that you can regularly do so you can finally enjoy a more stable financial situation.
Money-saving tips for you
These tips are not meant to change your situation in an instant — they’re not miraculous! — but if you can try to implement some of them, then positive things are bound to happen.
1. The first thing you need to do is learn to track your expenses.
Find an app that helps you track your expenses. These apps help categorize your spending so you’ll have an idea of which ones you spend on the most.
Most of these apps come with features like an expenses organizer, budgeting, and monthly expenses breakdown. There are even some that can connect to your bank account and credit card/s, so you’ll have regular updates and reports about your spending activities.
If an app is not your cup of tea, then maybe you can go the traditional way and stick with a notebook, or journal. Or you can use a spreadsheet to record your spending. Anything that you can use will help you start your journey to a better financial situation.
2. Learn how to manage your expenses.
Aside from tracking your spending, it is also important for you to learn how to manage your expenses. There are several ways you can choose to do this.
Your first option is to follow the 50–20–30 spending method. The 50 refers to 50% of your income that you will set aside and use for paying off bills and other essential expenses. Then you’ll have to allot 20% of your income for paying off loans and debt, or for your savings account (if you have one). The remaining 30% is what you should use for personal expenses like shopping, travel, and dinner out with family or friends. You can actually choose which percentage of your income goes to each expense type (ex. 70–30–20 or 60–20–20). The important thing here is you still get to enjoy even while paying bills and settling loans.
You can also choose to adapt the envelope method. After getting your money from the bank or the ATM, prepare several envelopes and mark each with a variable expense. Examples are bills, groceries, clothing, and personal needs. Then divide your cash among the envelopes and bring each only when you’re going to use the money already. So, for example, if you’re planning to do the groceries tomorrow, be sure to bring only the envelope you prepared for that particular expense.
Your last option is to follow the zero-based budget method. What you’ll do here is prioritize bills and essential expenses and spend for nothing else. This can be a bit difficult to accomplish, but it’s the ideal option for people who rely on their paychecks.
If any of the above-mentioned proves to be too much of a challenge for you, then opt for managing your expenses by allotting more or less 10 to 15% of your monthly income to savings.
3. Don’t use/Stop using credit cards.
Credit card debt is one of the major contributors to money or financial problems. If you have a credit card (also known as “plastic money”), it’s easy for you to forget about how much you’re spending and even what you are spending for. Sometimes, you buy something just because you like it and you can swipe your credit card to pay for it — but you don’t really need it. It just adds up to your expenses. So, yes, don’t get too blinded by credit cards.
If you already have one, it’s time to throw it (or them) away. Better yet, get a good pair of scissors and cut off all your cards so you won’t be tempted to use them.
4. Learn how to save.
It sounds so simple but it’s not an easy thing to do. The first step, however, is for you to open a bank account. If you’re not comfortable with banks (some people think banks have small interest rates), then go for cooperatives. FICCO or First Community Cooperative is the leading coop here in the Philippines and offers various services that can help you save.
The above-mentioned are just some of the things you can do to effectively improve your financial situation. Before trying out any of these tips though, be sure you are dedicated to improving a major aspect of your life — one that can help shape your future.