From childhood our relatives talk to us about the importance of saving and they give us the first piggy bank, a deposit of coins and bills, normally in the form of a pig, in which we keep our initial finances. Without realizing it, we grow up with the need for the piggy bank and we put it into practice, using various techniques, according to the lifestyle we lead.
The “little pig” is important. For any purpose that you set in the medium or long term, saving is a fundamental part of its consolidation, therefore, every expense you make must be conscious. Your task will be to minimize, little by little, the flight of finances and save the largest percentage of money possible, otherwise it will take longer to achieve your goals. Let’s start by changing the habit of consumption for habit of savings and the results will speak for themselves. It’s time to start pre-saving, have you heard it before?
Time to call the bank!
The pre-saving technique consists of inverting the traditional savings formula. Commonly, we wait at the end of the month to receive the salary, pay the outstanding bills and buy what is necessary —or not so necessary—, but if we levy an amount we contribute to the savings plan, this amount can be variable and sometimes absent. Now, if instead of waiting to have the money in your hands and being tempted to spend it, you contact the bank and request that as soon as the payroll is deposited into your account, a percentage of your salary be diverted to a bank account. savings, of which you do not have products for consumption, you would be practicing pre-saving.
Making an automatic savings will allow you to skip those funds, because you know what it takes to reverse the action in the financial institution. It is advisable to evaluate your expenses and earnings, and from there make an estimated amount of savings. The ideal is to start with 10% of your monthly income, although if it is uphill, determine it according to your possibilities and, gradually, you could increase the pile. The initial approach is to get used to this strategy and assume it as part of your expenses. Save before you have the money and you will always have “a mattress”.
Have you received extra money in the month? You can use 50% or a little more of it and transfer it to the savings fund. The more money you collect, the easier you will reach your goal and you will notice that some of the expenses are sometimes unnecessary. Avoid spending more than you earn. We know that when the money is in our pocket it disappears in a jiffy. Imagine having an unforeseen event and not having the financial resources to solve it, given the circumstance you will be forced to ask for loans, a very different fact than having the support or part of it, thanks to what you have saved.
Cut expenses and kill your “financial enemies”
As part of the pre-savings you must study, cut and readjust the distribution of your finances, because remember that when you start this tactic you will have a different amount of money in the month. The best thing is that it will favor you in balancing your expenses. You can also make a parallel savings on a daily basis, with small amounts, on every purchase you make. Take advantage of offers and discounts! What you don’t spend will be profit. As you are reducing expenses, you can gradually increase the percentage of your savings plan; with a lot or a little, the important thing is to save.
Do you have debts? Sometimes we cannot avoid them and although we want to keep the money in a piggy bank, we have commitments ahead of us. When starting the pre-saving you should avoid getting into debt, at all costs, although if you have no alternative, plan a new strategy to pay them off; Your option could be the Snowball method, devised by the Harvard researchers, which consists of paying off the smallest debts first and, progressively, the highest ones. Discard purchases on credit, she will be another of your financial enemies.
Currently, there are mobile applications created to help you save and evaluate your line of expenses. They are tools in which you can categorize your expenses, analyze them according to the debits of your bank cards, design a budget, and even compare the prices of products in supermarkets. There are endless options to save!
Sometimes tastes are temptations for our wallet and we don’t always need everything we see. Prioritizing expenses is the basis of savings and if we have a medium-term plan, propose an estimated date to free yourself of debts – if any – and another deadline to reach the total amount of money that you estimate. If you have exceeded the stipulated amount, you will know that your habit has changed and each month you will see better results. Orient your finances to a secure future.
When considering the change of address it will be important to have a piggy bank, savings are the key to your next step. It is advisable that your income be used for basic expenses, each coin will be a contribution to your new route and for this, you have SwiftFlats. Did you like our article? Join the SwiftFlats community!