7 Best Ways to Save Money

7 Best Ways to Save Money


We will discuss some best ways to save money. Saving Money is a Crucial Part of our living. Growing up, many of us were instructed on the values to save money and to be responsible consumers. Save More ! Grow More !

Introduction

 

Even the best of us, however, tend to forget some of the best ways to exercise excellent frugality.  And of course our bank accounts end up suffering for it. We must save money and come let us learn how to do it.

Since my childhood days, my parents have been saying me, Save Money for “A Rainy Day”. I do believe that one should definitely save for the uncertain times. Like for example- this current situation of COVID- 19. We all know this pandemic had brought a massive drop on the economic conditions. Few sources also say that, the economic situation is tragic and would take us all back on a flash back of 20 years.

Sometimes the hardest thing about saving money is just getting started. This step-by-step guide for how to save money can help you develop a simple and realistic strategy, so you can save for all your short- and long-term savings goals.

And trust me once you take the initial step of saving daily, you will yourself notice a significant difference. People usually tend to forget the importance of savings, but lately we all have realized the that, “Without Savings its difficult to Survive”.

As per Darwin’s Theory of Survival of the Fittest, According to me the one who will Save More will Survive more in the time of crisis, as well.

 

Save Money for Future

Consider that you may need to save up for pricey necessities like a car and a home. The average population will own a total of may be two cars in their lifetime, so it may be a good idea to start saving for your next vehicle now, even if you don’t currently need one.

Finally, it’s essential to save for retirement from your first job to your last. According to a recent study, most people near retirement have only save ten percent of the recommended amount for retirement. That may be because getting to a place where you have extra income to save takes time, but may also be because many people don’t practice good money-saving techniques from an early age.

 

1. Buy used items/ Second Hand

We remember to buy used items with some purchases, like cars and video games. But we usually forget to shop for used items when looking for clothes, electronics, or even furniture. Obviously, this doesn’t apply to perishable items, but utilizing websites such as Elanic and social media platforms can lead to huge savings for you.

One of my favorite past times is visiting thrift shops on weekends (even before the song came out) and gauging the prices. When I’m in need of something later on, I know (roughly) how much it’s going for at discount stores.

2. Wait a day before you make a purchase so that you can Save Money

This is crucial for big purchases. Impulse buying is a major contribution to why our bank accounts aren’t where they should be, so If you really want to buy something, wait a day or longer and see how you feel then. Chances are that you’ll be less tempted to make the purchase, unless it is something you really need.

Don’t be an IMPULSIVE buyer, be a smart buyer.

3. Use cash.

Credit cards, while gloriously convenient, can be exceptionally deceitful. We tend to use them flippantly, not considering the impact they’re really having on our personal finances. If you use cash, however, your subconscious is more likely to feel the pain from losing that money, resulting in a more conscious effort to curb your spending and save money instead.

For big purchases, you might find it worthwhile to use money orders for that same reason, and that will help establish a mentality of preparing your finances before making big decisions.

 

4. Borrow (or buy) from your friends.

Ask around! Friends are a great resource for borrowing essential items such as furniture, kitchen accessories, and more. You may also get a great deal if you buy from your friends, seeing as they’re motivated to help you while also getting a form of compensation, and they may even offer some items for free that they don’t need. Just remember to return the favor.

5. Cut Down on Unnecessary expenses.

It is always advisable to cut down on unnecessary expenditure. Precisely, we might think that this expenditure is worth giving a try. Else it usually happens with all of us, whenever we step out to shop, we usually tend to buy the stuff, which we generally do not need at the moment hence it will help to save money

For example- If i go to buy a Black T-shirt, I just might grab a blue one instead of Black, just because of the good pattern. Then again I would have an excuse to go for shopping because of the Black T-shirt I needed was not taken by me.

Further elaborating on this, You can make a list whenever you go for grocery shopping. Because we tend to buy excess stuff whenever we go out to shop groceries etc.

If possible you can stock up at the time of sale season as well this will help you to save money.

6. Jot Down the Expenses and Save Money

It is always beneficial to jot down expenses on a day to day basis. I usually like to prepare an expense sheet to keep a check on my expenditure. Also its always beneficial to have a tab and control over your spending. I always divide my sheet into two blocks “Unnecessary” “Necessary” “Crucial”. As the name suggests I always invest on the Crucial and the most required commodities first, which makes it easy to sustain day to day activities.

Speaking about the Necessary Items, sometimes, the necessary items are also Not so Necessary and can be skipped from our budget. We should have a look on that, and manage accordingly which will boost us to save money.

 

7. Investing In Mutual Funds, Shares, etc

For many people, the word “investing” conjures up images of men in suits, monitoring the exchange of millions of dollars on a stock ticker.

Saving money and investing it are closely connected. In order to invest money, you first have to save some up. That will take a lot less time than you think, and you can do it in very small steps.

If you’ve never been a saver, you can start by putting away just $10 per week. That may not seem like a lot, but over the course of a year, it comes to over $500.

Try putting $10 into an envelope, shoe box, a small safe, or even that legendary bank of first resort, the cookie jar. Though this may sound silly, it’s often a necessary first step. Get yourself into the habit of living on a little bit less than you earn, and stash the savings away in a safe place.

Start with small amounts of money, and then increase as you get more comfortable with the process. It may be a matter of deciding not to go to McDonald’s or passing on the movies, and putting that money into the cookie jar instead.

Don’t forget:

Investing is not a get-rich-quick scheme, but rather a way to consistently grow the wealth you already have. The good news is that even though investing is a way to grow your wealth, you don’t have to have a lot of money to get started.

Compounding interest dictates that even small sums of money can be turned into fortunes over time, providing you select the right investments and save money wisely.

 

QUICK NOTES ON INVESTMENT

Where Should I Invest Money?

When deciding where you should invest your money, you’ve got plenty of options. These options include:

1. The Stock Market

The most common and arguably most beneficial place for an investor to put their money is into the stock market. When you buy a stock, you will then own a small portion of the company you bought into and when the company profits, they may pay you a portion of those profits in dividends based on how many shares of stock you own.

When the value of the company grows over time, so do the price of the shares you own, meaning that you can sell them at a later date for a profit.

Other investment options include:

2. Investment Bonds

When you purchase a bond, you are essentially loaning money to either a company or the government (for US investors, this is typically the US government, though you can buy foreign bonds as well).

The government or company selling you the bond will then pay you interest on the “loan” over the duration of the bond’s life cycle.

Bonds are typically considered ‘less risky’ than stocks, however, their potential for returns is much lower as well.

3. Mutual Funds

Rather than buying a single stock, mutual funds enable you to buy a basket of stocks in one purchase. The stocks in a mutual fund are typically chosen and managed by a mutual fund manager.

Many people have the opinion that Mutual Funds are risky. But even I have invested in Mutual Funds, and they are profitable in the Long Term basis.  It helps you to save wisely and also controls the flow of cash and helps to increase purchasing power.

But here’s the kicker:

These mutual fund managers charge a percentage based fee when you invest in their mutual fund.

Most of the time, this fee makes it difficult for investors to beat the market when they invest in mutual funds. Also, most mutual fund investors don’t actually ever beat the stock market.

4. Savings Accounts

By far, the least risky way (and probably the worst way) to invest your money is to put it in a savings account and allow it to collect interest.

However, as is usually the case, low risk means low returns. The risk when putting your money into a savings account is negligible, and typically, there are little to no returns.

Still, savings accounts play a role in investing as they allow you to stockpile a risk-free sum of cash that you can use to purchase other investments or use in emergencies so you don’t touch your other investments.

5. Physical Commodities

Physical commodities are investments that you physically own, such as gold or silver. These physical commodities often serve as a safeguard against hard economic times and helps to increase your savings and ultimately to save money.

QUICK TIP:-

Best Ways to Invest Money in Your 20’s

It’s never too early to start investing. In fact, just a few years of a head start can often lead to hundreds of thousands of dollars more money by the time you retire.

When you’re investing in your 20s, it’s best to start out by focusing on paying off any debt you may have such as student loans or credit-card debt.

 

Debt works just the opposite of investments, exponentially decreasing your wealth rather than exponentially growing it, so it’s a good idea to make getting debt-free your first and foremost goal.

Once you have your debt under control, start researching the stock market and investing as much as you can.

Take in as much information as you are able, and start highlighting quality companies that you believe will grow in value over time.

Best Way to Invest Money Short-Term and Save Money

Short-term investors make money by trading in and out of stocks over a short period of time rather than buying and holding them for several years.

While you certainly can make money doing this, the problem is that no matter how skilled at trading you become, there will always be a big element of luck involved.

Consider this:

For beginner investors, short-term trading comes down almost entirely to luck, and you can easily lose as much or more than you profit.

Rather than thinking about investing as a way to make short-term gains, it’s better to think of investing as a way of making long-term gains.

Keep in mind that you’re still making money either way.

With long-term investing, though, you are able to minimize your risk and negate the sometimes-crushing effects of short-term volatility and price-drops.

 

Also view my other article:-

Mystery of the Crystal


  • TAGS :
  • budget friendly |
  • Coronavirus |
  • covid-19 |
  • How to Cope Up with Stress |
  • money saving |
  • tipstosave |

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A Chartered Accountant by profession. Fashion and Lifestyle Blogger, Influencer and Tiktoker by choice.

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