The moment you decide to save, you are taking control of your finances – and that control can put you in great stead for your future.
Without savings, life can become expensive and unstable.
The problem is that when emergencies happen, like the washing machine breaking, the car needing a lot of work after a failed MOT or a large electrical item breaking, replacement isn’t possible without cash, and rental can come at a much higher price.
Savings aren’t just for when things go wrong, though; some of the biggest things in life are worth saving for, like having children, buying a new home or car, and getting married. Perhaps you want to travel the world.
Almost everything is made easier when you have some money put aside to make it happen.
But saving, for most people, seems like an impossibly long process.
And in part, that is true; saving is forever – because you will always need a nest egg to help you or your family or just to live comfortably.
So, how can you make the saving process faster and more efficient?
Yes, no matter what you are saving for, you are going to need to take a look at your budget.
Your budget will tell you where you can save, where your money is going, and the exact amount you have to put aside.
For most people, they don’t really check out their incoming and outgoing too much – because they become the ‘norm.’
So, it’s time to pull the last 6-12 months of your bank statements and take a look at where your money is going.
You might be surprised to find you are paying for services you don’t use or that you are spending a lot more on takeout than you thought.
Take a look at all of the variable costs (nothing related to rent, bills, and other things you need to pay).
How much could you be putting aside if you are stuck on a tighter budget?
The chances are a lot more than you think.
Kick debts down
Having any amount of debt can make it difficult to live comfortably, and for millions of people, debt is something they face on a daily basis.
Debt comes in a couple of forms, though, and there are even some debts that are considered good and others that aren’t.
Good debt, like a student loan or a mortgage, isn’t frowned upon – they are considered to be beneficial to your long-term finances.
Bad debts, things like cars on finance, taking credit for things like holidays, and using credit cards without paying a larger than minimum payment.
No matter what type of debt you have, it is important to take a look at how much it costs and if there is anything you can do to change it.
Paying debts down isn’t easy – and many people would rather pay the minimum and then spend money elsewhere.
But the only way to save faster is to pay down debt and free up what you have been paying back.
Talking to a debt company can help to freeze interest or negotiate a lower lump sum – so you have more cash to put into your savings and can be worry-free.
What are you saving for?
What is the pound and pence that goes with it?
Those saving for a house might have a few numbers they are saving for – moving costs, down payment, and decoration costs.
You can do a set without a bridging loan and one with the calculations of Finbri bridging loans, and see how that looks long term.
Setting goals is an essential part of saving; without them, you are likely to save less or be less dedicated.
Instead of saying you want to save 5 thousand, give yourself some reasons for it.
With some solid reasons, you are more likely to reach those goals.
And perhaps more importantly, what you should do is break the bigger goals down into smaller goals.
These smaller goals are more achievable, and that means you are going to hit these milestones more often.
Hitting the milestones gives you a happy rush, and that means you are more likely to keep going.
Much of the frustration that comes with saving is setting huge goals that feel like you won’t reach them.
When you have to manually move money out of one account and into a savings account, you aren’t always going to want to do it, or you might not remember.
Both of these are going to hamper your saving ability – and that means you are going to save a lot slower.
To speed it up, one of the best approaches is to take the hands off the wheel a little bit.
If you know that you will have issues with moving your money manually – or the temptation to spend it elsewhere is too much – use one of the automated saving apps to do it for you.
There are a couple of good options for automated savings, but who you choose will be based on your needs.
Here are a couple of options:
Each of them uses an algorithm to work out what you can afford to save without cutting into your regular bill money.
Taking a lot of control here, for those who know they are a bit of an overspender, then it is time to stop yourself in the best possible way.
A combination of willpower and a hard limit can help you prevent any extra spending.
Set a daily spending limit, and decide if you want to be able to take money from an ATM or not.
Not all banks have this function, but you can call to see if there are better account options because you are trying to save.
The idea might already have you feeling exhausted, but the one real way to save faster after making all of the cutbacks that you can is by earning a little more.
If you find that negotiations with your current employer don’t go anywhere – it is time to start looking at other opportunities.
Keep in mind that any side hustle doesn’t have to be for the long term; it can just be during the period of time that you are saving harder.
Make a deal with yourself that everything you make on the side goes directly into savings.
Although you might want to get yourself a little treat because you have done so well, try to keep in mind that reaching your big savings goal is actually much better.
Another place to put any money that you make from a side hustle is towards paying off any debts – because this will directly help with how much you can save, too.
We live in a society that is see it now, buy it now, deliver it tomorrow, and pay it off in three months.
And when that is the norm, it can be difficult to break out of that.
However, one of the most effective ways to break impulse spending is to put a time limit on anything that isn’t essential.
Thirty days is usually a good start.
From the day you see something that you want, start a 30-day timer, and at the end of that 30 days, go back and see if you still want it – or you just wanted it at the time.
Almost every time, you will decide that you don’t need it.
The early days of saving can feel scary – but really, making a few big commitments to yourself can make a significant difference to the process.