How To Save More Money Monthly! Best Practical Money Saving Hacks for 2023: Hello there and welcome to Exclusivetool.com, your one-stop destination for personal finance, investing, and wealth management.
Today we’ll be sharing with you 5 tips that will enable you to save tons of money every month. So without any further ado, let’s dive in!
Saving money is a big problem for most people, simply because we love spending every penny we earn. Let me introduce to you three of my friends – Bill, John, and Brandon.
Bill is 25 years of age and l loves spending money. He is like most of us, he doesn’t save money because he has a stable job with $38k (after taxes) that covers all of his expenses, mortgage, car, and the new iPhone he recently purchased.
As time goes by, Bill gets married and he becomes a father. Now, instead of covering only his expenses, he has to cover his child and probably his wife’s expenses as well, but unfortunately, his salary only increased by 15% in the last 5 years.
So now he has to cut down his spending to be able to pay for all the necessary things. As life moves on, his salary keeps increasing, but not as much as his expenses.
Eventually, after many years, Bill decides to retire at age 65 ($50k), only to now figure out that he hasn’t saved up any money for his retirement. So he is left with no other choice but to keep working.
On the other side, John doesn’t want to find himself in Bill’s position when he reaches his 60s, so he decides to save 10% of his income, hoping that by the time he is 65, he can stop working and enjoy his life.
After 40 years, assuming that his income increased by an average of 3% per year, he manages to save $264,385. Obviously, that’s not enough money to travel the world and cover your expenses for the next 20 years or so, but at least it’s much better than Bill.
Now, our third friend – Brandon who is also 25 and makes a similar income, realized that saving 10% of his income isn’t going to make him financially free anytime soon. And if he wants to see any significant difference, he would have to wait until he is 65.
So he decides to take a different approach. Instead of saving 10% of his income, he decides to save 25%, and rather than saving, he opted to invest it into an investment fund. Like his other two friends, his income increases by an average of 3%.
Assuming he only keeps investing $9k out of his salary (although his income increases 10% every year), in just under 10 years, his savings would have grown up to more than $150k ($151,093).
He can withdraw that money and start his own business and maybe retire earlier or he can simply keep it as an investment fund and without saving a single penny for the rest of his life, that initial savings of $150k will grow up to $4.2 million ($4,246,087.11) by the time he retires.
So compared to Bill and John, Brandon would have either retired earlier or have an amazing retirement.
Now, what sets Brandon aside from his other 2 friends is that he knew he would sacrifice 10 years of his life now, he will be able to live the rest of his life as he wants!
Read also: Why A College Degree Won’t Make You Rich
(1). KNOW THE PURPOSE OF SAVING
So the first idea here is that you should know exactly why you want to save money in the first place. A lot of people give up and stop saving because they don’t see exactly why they’re saving in the first place.
Your goal shouldn’t be to save for a great wedding or a brand new car, because once you get that car, you will go back to your previous position and still face those financial challenges again. So, the ultimate goal should be to achieve financial freedom.
(2). PAY YOURSELF FIRST
Before even spending a single penny out of your income, put aside a percentage of it into your savings account (if you don’t have one, then make one).
You are not allowed to spend this money under any circumstances, no matter what you’re going through, this money cannot be spent anywhere, but can only be invested. Consider it to be part of your taxes (which you have to pay whether you like it or not).
(3). KNOW YOUR EXPENSES
If you’re not a consistent saver, then it might be really difficult to start, especially in the first couple of months when you realize that your savings aren’t growing as fast as you would want them to. So, instead, know your expenses first.
Spend the next 30 days writing down every transaction you make, so that by the end of the month, you will have a detailed understanding of how exactly you spend your money and you can deduct your money in those areas that don’t have a big effect on your life.
For instance, instead of buying coffee every morning, you can make it yourself at home and save somewhere around $50–$70 every month. Instead of driving, use public transport to get to your job (if it’s more affordable) and you might save another $50–$60 there.
If you stick to this routine, you should be able to save a couple of $100 every month.
Procrastination is bad, but not in this case. Usually, we get excited when we want to buy something new right away, even if it’s something we don’t really need, but that excitement goes away over time.
It’s like when you buy a new phone, in the first couple of days you might still be excited about it, but then, you know what happens, it just becomes normal. So why not get into the habit of waiting to buy things, especially expensive ones?
You’ll still end up buying all the important things you need, but there will be plenty of times when you change your mind and hold onto your cash.
TIP: Wait for a week before splurging on something expensive.
(5). USE CASH
Whenever you purchase something, endeavor to always use cash instead of a debit card, whether you’re ordering food in a restaurant or getting something from groceries.
Handing over a $20 bill is a lot harder than just swiping your card, simply because when you swipe your card, it feels like you’re spending a lot less.
Overtime, you will become a more conscious spender and you’ll buy more of what you need and less of what you want.
Well, there you have it. Make sure you check out our other blog posts for more information on personal finance, self-development, investing, and wealth management.
Read also: The Secret To Building Wealth: Personal Finance Management
Conclusion on How To Save More Money Monthly! Best Practical Money Saving Hacks for 2023
In conclusion, there are many practical money saving hacks that you can incorporate into your daily routine to save more money each month. By making small adjustments in your spending habits and being mindful of your expenses, you can significantly increase your savings over time. Some of the best money saving hacks include creating a budget, meal planning and cooking at home, negotiating bills and subscriptions, cutting back on unnecessary expenses, utilizing coupons and deals, and using cashback apps and rewards programs. It’s important to also prioritize your financial goals and regularly monitor your progress towards them. With dedication and discipline, these money saving hacks can help you achieve your financial goals and build a more secure financial future for yourself.
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