Money is such a taboo topic in many spaces we find ourselves in with family and friends. We can talk about many things but once money is involved people start becoming uncomfortable. It’s crazy how in school they teach us different ways to make a living, but no one teaches us how to spend and use that money.
How many of us are in debt or living paycheck to paycheck because we don’t know how to spend our money efficiently? From my experience, I know that using and saving money has been a matter of trial and error. It wasn’t until I was in my mid-20s that I learned how to save, invest and use money. Even then, I continue to learn by using resources like YouTube or books to gain more knowledge and equip myself.
These are some financial books to read to help you that I have found helpful
The Retirement Savings Time Bomb Ticks Louder: https://amzn.to/3ZdkpFm The Richest Man in Babylon: https://amzn.to/4ePZYEb
Here are some steps that I have learned and ways that can help you save money:
1. Create a Budget Plan:
To save money, you must first create a budget plan that tracks your income and expenses. This will help you manage your money and identify areas where you can cut back on expenses and increase your savings.
Budget Planner you can use: https://amzn.to/3Otc8rV
2. Set Financial Goals
When saving money, you need to know what you are saving it for. Sometimes having money lying around in your savings or bank causes you to be careless with that money because you don’t have a plan for it.
So having financial goals helps you plan for important events and fun things in your life.
Financial goals vary from :
- Things you want to achieve in the next year? Five years? Ten years?
- Saving for major/minor purchases, like a home, vacation, car, or birthday party.
- Planning for the future such as a retirement plan.
All these plans are set in place to prepare you so that your financial short and long-term goals become successful.
3. Set up A Savings account
Saving is a crucial financial habit to have in your life. It can help you feel secure financially, especially for those rainy days that happen unexpectedly.
When you open your savings account it is important to consider writing down your saving goals to help you feel motivated to keep on saving for things you might want and need, such as saving for a home, holiday, or even having emergency funds for when things get tough.
What I have learned that is helpful for me in my financial journey is having different savings accounts for all my savings. Having an account for emergencies, one for holidays, and one for property. This setup helps me save better and I don’t need to stress about using too much or too little when I need to tap into my savings because I have already allocated which savings I am going to need.
In addition, I have learned that having a high-yield savings account is best to ensure that you get extra interest on your savings.
I use the Franc website for my emergency savings. You can use my referral code- thandile3 when you sign up: https://franc.page.link/e8H2ycs4ZMbvJSt68
4. Reduce Debts and Expenses
This has to be one of the hardest things to do on my list because I enjoy and love doing nice things in life. I love shopping, doing my nails, and eating out, so having to reduce my spending habits has been tough. However, the more learn about finances the more I realize that I don’t necessarily have to stop doing things I enjoy for myself, but I must not spend recklessly without a budget.
If I don’t have the money to do something, then I should avoid taking out my credit card and using it, especially if it’s something I can do without. If I must use a credit card then I must have a plan to pay it, so that I can avoid paying high interest rates.
5. Have extra income/Side hustle
I am sure you have heard many people talking about side hustles and even though It’s not easy to start for many of us this extra income has helped a lot. Having extra money helps you organize your finances, and also you can allocate some to your savings without putting too much pressure on your main source of income.
Here are great books if you want to get started https://amzn.to/3Vgf534
6. Move at your own pace
Something I wish someone told me when I started saving and investing was that I can move at my own pace and not feel pressured to have as much money as the next friend or person I see.
It is important to know that we do not all have the same goals and plans and therefore our finances will not be the same. The most important thing is that you have an idea of what you want and that you have started building on those plans to achieve financial stability and freedom.
I hope these financial and saving steps will help you establish good saving habits and make progress towards your financial goals.
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