One of the trickiest questions in the realm of personal finance would be finding the most efficient way to save. And a lot of experts and professionals will often answer that this really depends on your current financial situation. That much is true – because it really depends on how much you earn, what sorts of debts you have, what you pay for, and what you want to do with your savings. However, just because the process can be complex doesn’t mean it’s impossible to accomplish. If you want to find the most efficient ways to save money, then you’ve come to the right place. Here are some of the most efficient methods to save money:
Adjust your lifestyle.
Part of the reason why a lot of people find it hard to save money is because of their chosen lifestyle. Sometimes, what we think are “safe” nights out, or gatherings with friends, or parties, and even the occasional smartphone or two, can actually have a huge impact on our savings. Try to look at your lifestyle and eliminate components that require unnecessary spending. This might not be much at first, but a lifestyle adjustment can have a huge payoff in the form of less spending in the long run.
Record your expenses. An important part of being able to save money is to know exactly what you’re spending, and if there are adjustments you can do in the process. Are you spending too much on your transportation? Maybe commute. Are you spending too much time on eating out? Maybe you can eat at home. Noting your expenses allows you to have a better understanding of how much money you might be wasting or spending into unnecessary things.
With your budget in mind and your savings goal in your head, try to see if there are ways you can adjust your lifestyle to help you save as much money as possible. When we say “adjust your lifestyle,” we don’t mean go totally away from your means. Rather, adjust your lifestyle in such a way that lets you spend less without sacrificing comfort and quality of life. Maybe you can opt for disposable utensils to save water, or use less electricity.
If you need to have extra money, maybe you can get extra shifts, extra workload, or even a part-time job to increase the money you have on-hand. This can get in handy for paying for debt, adding into your emergency fund, your insurance, or your savings overall. Such a situation can be helpful, especially now that there’s a ton of services like my-estub login that can help you keep track of how much you’re paid by employers without having to use complicated software.
Eliminate debt as soon as possible
This might be the hardest – but perhaps the most important – element of your quest for saving money. While you might think this can be a bit detrimental to the goal of this article, this tip might also be the most meaningful. How can you properly save money on your own terms if you have looming debt? Part of the process of saving money is to develop good financial habits, and you can develop such habits while in the process of paying off your debt. Imagine, once you focus on “saving” a particular amount of money to pay your debt, you’ll likely be able to focus on “saving” a particular amount of money to actual savings in the future. It’s all in the habit.
- Take note of what debts you currently have, and focus on eliminating the largest debt you have. This largest debt will likely have the biggest interest rate, and will likely demand the most attention on your finances. Having this gone will allow you to spend more time allocating money into your savings and your other debt without worrying about not meeting your monthly dues. This will likely hinder you from actually saving substantial money for a while, but once your debt is fully paid, you’ll not have much to worry about. This is also good for your credit score.
- Once you’ve paid off your debt, get a “new” one – in this case, a savings goal. It’s hard for others to save money because they only think of the action of “saving” and not what you want to use it for. It might help to actually visualize what you want to save up for, as well as setting up a timeline for you to achieve it. Do you want to buy a house within a few years? Do you want to get a car? You can use the same principle as “paying off debt” to “paying off your savings.”
Focus on an emergency fund
Again, this might be another tricky thing to do – after all, why save money if you can’t immediately spend it on relevant things? However, it’s important to be able to set up emergency precautions should accidents or other things happen that might immediately affect your financial status. Accidents, family and even professional situations might have some form of impact on your financial status. Not being prepared for such an eventuality might ruin your savings plan.
- If you can, try modifying your savings and checking account to do something called auto debit every payday. This allows you to automatically move money from your paycheck to your savings, which essentially sets up an emergency fund without you knowing it.
Invest on saving
Another efficient way you can save money is to spend it – weird choice of words, right? The thing is, you can actually save more money by investing in smarter choices around you – be it with yourself, or with the overall household. For instance, if you want to lessen your utility costs, don’t wait for the utility companies to lower prices for you. Instead, make measures to ensure your household doesn’t consume that much electricity and water. If you make many of these smart investments, not only will you “reclaim” what you’ve spent in a few months or years, but even save more money naturally.
- Invest in improving aspects of your day-to-day operations, especially at home. If you have extra money, you can invest in rainwater storage tanks, renewable energy sources such as solar power, and even repair broken utility tools at home. This might be costly, but it’s an investment that can help you save money for years to come.
- Invest in insurance, especially life and accident insurance. Aside from an emergency fund, having insurance for you and the family will allow you to be able to have financial assistance in the case of emergencies that would otherwise be too costly. Having insurance also allows you to seek the services of professionals for free, provided you get to pay your premium.
Smarter Choices, Planning Make More Money
Remember, with the tips above, you’ll likely be able to save quite a bit of money with a few lifestyle adjustments. These might not make you immediately save a ton of money on the get-go, but developing a habit of decreasing your spending this way can at least help you slowly save up money to meet your spending goals. The idea here is to slowly cultivate habits that will enable you to save up but not necessarily ruin the lifestyle you’ve set for yourself. And always remember to adjust the tips above to your needs so you’ll still live the kind of life you want with important financial adjustments.