Saving is pretty difficult for most people, and when I say most, I mean like 99.9% of people (this is an exaggeration but you get my point). Money-hungry corporations and marketing tactics, entice you to spend with adverts everywhere you look whether it be while sitting at home watching TV, browsing through social media, or even on billboards while driving to work. So, the question is, how do us regular folk who don’t have trust funds or copious amounts of money, save? Below are a few tips I have put together.
Tip 1: Always Pay Yourself First
Assuming you are not working in personal overdraft (credit card debt etc.), then always pay yourself first. The reason I say this is because your interest rate on a personal overdraft is often higher than the interest rate earned on an investment or saving. So, if you are “saving” but have debt where you are being charged a high interest then you are effectively losing money. Anyway, my point is, straight after pay day, deposit money into your money market account before doing anything else.
Hint: Get a money market account, interest rates are more attractive than standard bank accounts.
Tip 2: Manage your Annual Increase
When yearly increase time comes around, don’t start looking to see where you can spend that well-earned, extra percent. Take at least half of the rand value of this increase and increase your monthly investment premium by this. The other half of your increase you can use for dealing with price increases and improving your lifestyle. (See what Liberty has to offer for the individual for monthly investments (and then give me a call).)
Hint: Make sure you have an investment debit order coming off each month, ensuring you save every single month
Related: Let Me Convince You To Save Money
Tip 3: Manage your Wardrobe
Since I am a guy, this is mainly directed at guys, although ladies there is a take away for you as well. Clothes can be pricey, but there is a way to look good without hammering your pocket. Pair your clothes well, and take time to plan your clothing purchases wisely. I am not saying don’t spend on clothes, what I am saying is that when you do, don’t spend on items that will date (i.e. pink slacks).
I normally splash out on neutral items because they are not only classy and practical but pair well with everything. For personality and colour, I mix it up with less expensive items (because I don’t always want to look like an old guy who rolled out of Wallstreet). Doing this, I can pair my inexpensive pink slacks and white shirt with a more pricey pair of tan shoes and suave navy blazer. For the record, I don’t own pink slacks but you get my point. I will be posting fashion tips on my Instagram so be sure to follow @smbfinancialplanner to stay up-to-date.
Hint: Make sure you have two different colour dress shoes, these will suit all occasions and last for years. My preference a black pair and a timeless tan option. Also, go shopping for clothes and longer lasting items every two months, this will take a bit of planning, but will pay off in the long run. Your savings and back pocket will thank you in the long run.