You cannot save what you do not have in this case you cannot save money you don’t have, you need to first make some money as salary from a job to be able to save in the first place.
The truth is we can only save if we have enough disposable income, and disposable income is the money that remains after taking care of all your needs and expenses
It is our disposable income that we will be increasing in this article considering we can only increase our disposable income through reduction on expenditure
In this case, we will consider all the money that remains after you have also taken care of your lavish style.
It’s easier to save when you are not saying no to yourself and that’s by taking care of your wants and needs first though this only happens when you have enough money.
And if your disposable income is high enough it is better to save it through reinvesting it, you could start a new business out of it
So this article may not be helpful if you don’t even have what save but if you are earning money some as salary from your job, it may not be a lot of money but we can get going on how to increase the savings
1. Exercise Self-control on spending
This is the first step to save money. If you cannot control yourself you will spend whenever you have money or when you do not have the money you will at least borrow
You have to exercise self-control when it comes to saving so that you can forego something you want to spend the money on and save it
2. Save on what does not affect you
No one lives in your life to know what is important or not but they’re things we would all consider important
We would not expect you to forego your meals as you might end up with ulcers or even an unbalanced diet and you could end up spending more on medication but we sure expect you to save on beer at least
3. Saving in form of re-investment
Saving in form of re-investment would be using part of your money to start a new or a side business. In this aspect, you will have at least two sources of income
It is very risky to have one source of income as you can be fired any time and that could mark the end of you but a side business would be a good shock absorber for that event. You could also buy shares as a way of reinvesting your money
This is the reason why the rich own a lot of businesses as they do not just save their profits or disposable income in the bank but also do invest in other businesses
4. Saving on only wants and wishes and spending on only needs
Here we will need to sacrifice and forego some of the things we spend our money on everyday
For instance, you find if you use public means for transport you will spend about 50 dollars and when you use your personal car its 100 dollars on fuel
So if you save 50 dollars per day that will be 1500 dollars a month and in a year that will be 18000 dollars
This would be a very good way to save money especially for students
5. Do not borrow
Seriously every time you borrow you are indirectly reducing on salary while also unnecessarily increasing on your expenditure.
For every salary, you earn you have some money off from someone you borrowed from and at times the whole salary is a loan. So your salary is not even yours anymore
Because after you pay the people that demand you, you will be remaining with less money and you will have to borrow again to catch up with other bills
In the end, you cannot save when you are always creating debts
6. Checking on subscriptions
Sometimes we subscribe on things we do not even use for instance you may spend a month away from home but your pay-TV will continue with the monthly subscription even when no one is watching the TV
So such unnecessary bills have to be cut off and this will help you save some money
7. Pay value for money
Most people associate price with quality. We can easily be fooled to pay highly for a commodity because we have been told its good quality basing on the price but not because it’s really good quality
But value for money is usually experienced in restaurants where you would be given less food because it’s a 5-star resultant when you could be given 5 times more of the same food at a less prestigious restaurant
This goes on when buying any commodity it will turn out expensive based on where you are buying it from even if it’s the same exact item and thus you will not be saving
8. Avoid buying cheap to save as some times it turns out expensive in the long run
Much as we talked about value for money, it does not mean we should buy poor quality products because they are cheap as they will end up expensive in the long run with repairs
It makes no sense to buy a second-hand car 2000 dollars and end up spending 2000 dollars in form of minor expense repairs only to realize later that you have not actually saved anything as the cheap car you bought is taking all your little savings
9. Make shopping lists and budgets
This should always be a rule when buying things. Make a budget list of things you need in order of priorities with the expected price
Go shopping and do not exceed the list total price, that’s why we should list the items in order of priorities so that if the money is not enough we at least have what we need
So next time you go back shopping you will have a good approximation of the prices
Otherwise, if you exceed the budget you will also be spending savings you would have put aside
10. Eating at home
Other factors constant, if you have a family eating from home will be a lot cheaper than eating out and definitely you will be saving some money than taking yourself out
But if you stay alone eating out may turn out cheaper. So you have to calculate how much you spend when you eat out and when you eat from home and choose the one that is cheaper as it will have you save
11. Repairing things on your own
There are a couple of tutorials on youtube on how to do different repairs. Perhaps you could fix some of your clogged pipes or change your car tire yourself
But if you cannot do something, well call a technician for it though you can learn from him to do it yourself next time
Because if you try to fix it and it goes wrong you may end spending more than you had intended to
12. Cut off addictions
Everyone has that one thing that they spend their money on and cannot do without it, but can live a million years without it
For example, most people right now people are addicted to social media and they definitely have to cash out some money to buy mobile data bundles
But we all know we can do without social media and replace it with interaction with real people than concentrate on virtual interaction though that is hard once you are addicted
So you will have to figure out that addiction that you spend your money on and do something about it as that money could be saved too
13. Do price comparisons
Do you ever go out and spend money because you have the money or just pay the price you have been told
Some items have standard prices so there is no need to accept being cheated and paying highly for an item
In other instances, you can bargain and if there are no standard prices, some items are sold cheaper in other places so if you buy items at cheaper prices you can save by buying items from places they are sold cheaply
14. Cut on your luxuries
The truth is the search for relevance is high today and everyone wants to post the new car they bought or the expensive jacket on social media
In the end, you end up buying expensive clothes just to remain relevant. But if you calculated the money you spend on those showbiz items it could have been saved by buying some less expensive
15. Keep celebrations and anniversaries simple
In a world where people still look for relevance and prominence, people still spend expensively on parties
Of course, no one would want a boring cheapskate party but you have to know your income standing
In fact, these days some people do not celebrate birthday parties because they do not have enough money but that is common, people hardly do celebrate them
The serious saving comes with weddings when people decide to forego wedding celebrations and do civil weddings as they are a lot cheaper. They are also able to realize the money for wedding parties could be saved for something else more developmental to them
People also do not even celebrate their graduations and instead use that money as capital to start a business after school and avoid looking for jobs instead
16. Saving money based on how you are earning
This is a simple calculation to help you with putting your saving in practice and see how feasible it is and adjust accordingly
I would not expect you to save US$10000 a month when you earn US$ 5000
We will assume you earn US$2000 a month. Of course, it could be more or less but you will plan your saving based on how much you earn.
You will also be saving based on the money you have at hand, not the money you expect to get for instance you owe someone money and they do pay back or if they delay to pay you at work
So will begin with expenses that cannot be avoided (prices are approximations use your own exact cost)
| Monthly Bills and expenses | Proximate cost |
| Rent and utilities like water, gas, internet, cable TV | $500 |
| Food | $250 |
| Transport( public means) | $250 |
| Total | $1000 |
From our earnings of US$ 2000, we are left with for US$ 1000 which we will divide accordingly for the things we are saving for so that each gets a share.
Some savings like for a car have a target price and when the target is hit, move your savings to other items and still save accordingly
You can also allocate your savings basing on cost and priority, for instance, you could give all other items 5 % of the disposable income and allocate the remaining percentage say a car 50%
We are saving for regular items that we use every day through saving or reducing on them like repairs and medical because we do not know when they will occur but when they do, they will definitely not affect our other savings.
You can also save based on items you want to acquire
| Items we are saving for | Amount saved for each item |
| Entertainment | $100 |
| Medical | $200 |
| Repairs | $200 |
| Car | $200 |
| Bank | $200 |
| Miscellaneous | $100 |
| Total | $1000 |
The reason we are saving some money in the bank is for security purposes though the main goal is to get monthly account saving bonus, basing on the type of account you have in the bank, you can be given a monthly saving bonus of about 2% basing on the amount of money you have in the bank at the end of every month
Basing on our savings above, it will at take you 25 months; that’s 2 years to buy a second-hand car of just about US$ 5000 which could be a long time and you may not be that patient but you can also realize if you forego all other items we are saving for, it will take you about just one year to buy a new car of about 12000$ or even less basing on the cost anyway
This is good evidence as to why you are supposed to minimize costs and reduce expenditure on your monthly bills expenses so that you can be able to achieve the things you are saving for within a realistic time frame or just saving more money
This also shows that if we are able to minimize our expenses through the above methods we will be able to save more money
Otherwise, if you spend more than you can save you will not be able to achieve some of your goals
The same aspect of saving can be applied if you decide to save money daily or weekly and not monthly
Conclusion
After reading through all the ways you can save money and how you can actually allocate your savings accordingly we expect you to be able to start saving some money very soon. And do what you want with your savings
You should also know your disposable income which will be saving, in this case, will entirely depend on the cost of your expenses which we have shown you how to minimize on their costs based on how much your salary is
