Strategies & Ways To Save Your Money Wisely | Start Cutting Your Expenses

Save money wisely | Cut down your expenses | Tips to spend Less Money

" Money is easy to spend and hard to save !"

Saving your money doesn’t have to be hard or daunting. Healthy money spending habits and little changes in your lifestyle can help you prioritize your future needs over your current wants! With an understanding of your budget and true needs, you will start saving more money than you ever expected.

If you are overwhelmed about how to save money without making any sacrifices, here are some tips and strategies to help you achieve it successfully. In this article, we will also be discussing the short and long term goals savings.

Create a monthly balance sheet -

Before jumping to the money-saving tips, you need to first create a balance sheet for your previous month's savings and expenses. This helps you to figure out your spendings right from groceries to shopping and credit card bills. Recording your expenses helps you to keep track of all your unnecessary payouts.

Create a similar balance sheet as shown below or else buy a small notebook to write down your daily expenses. Make sure you include every single payment you made even if it’s just buying a pen or giving a tip.

Click To Download the Sample Expense Tracker To Know your Spendings .

Classify your Income / Money -

Once you have an idea of what you spend in a month, you need to first classify them into 3 different categories -

• Daily Needs - This category must include your day to day utilities like - groceries, electricity, gas, travel, etc.

• Savings /Debts - This should have all your savings investments and monthly debts like - housing loan, car loan, credit card bills, etc.

• Wants / Miscellaneous - Last but not least list out all your wants or not so necessary expenses like shopping, outing, subscriptions, etc.

Now you have sorted out your spendings into different categories, you now need to budget them according to your lifestyle.

Savings and debts should be prioritized first - You need to at least aim to set aside 20% of your income for this. This will provide you with a better and stress-free life ahead.

Next should be your daily necessities. You should set a percentage of your requirements depending on a day to day basis. I would suggest keeping 50% of your income for your day to day spendings.

Finally, you have the miscellaneous expenses which totally depends on your wants. Limiting this can help you save a good amount which you can utilize in your savings or investments. Anyways let's give it a maximum of 40% for your income.

Set up Goals to Save More -

This strategy can be best to keep you focused on your savings journey. Start by thinking of what you want to save for - it can be your dream house, car, phone, an international trip, or retirement plans.

Try to classify your goals into the short and long term.

• Short term - These goals need to be achieved within one or three years. International trips/vacation, a dream phone or laptop, a bike, or a car.

• Long term - This, on the other hand, has to be achieved after 4 to 5 years. This can be your retirement plan, a child's education or marriage, a dream home, etc.

Once you are done with your goal settings, calculate an estimated amount and time you will require to achieve them.

Start with a small short term goal that you always longed for and a bit expensive for which you have no cash on hand to pay. Being successful in attaining it or rewarding yourself for the efforts you made will reinforce the habit of saving and even motivate you to achieve your further goals.

Steps and Strategies to Cut Down your Spendings -

1) Save from your Daily Needs -

These are endless. The more luxurious you are, the more money you spend on your daily needs. Leading a luxury life if you are earning a lot can be considered, but not if you have a very basic or small income. Here are the few steps you need to follow to save your money and at the same time lead an above-average lifestyle.

• Save electricity, save money

Switch off the lights and fans when not required. Invest in energy-efficient appliances to save some electricity. Though the amount might be very small when calculated in the long run will give you good value.

• Make a grocery list -

Set up your grocery list prior to visiting a hypermarket. Doing so will help you save time and money by resisting you from buying unnecessary stuff.

• Travel wisely -

If you are a daily traveler opt for public transport or Uber pool to save both money and the environment ! It reduces your car or bike fuel expenses which you otherwise would spend on a daily basis.

• Limit Body care essentials -

It’s necessary to have body care essentials like - lotion, face wash, perfumes, creams, etc. Invest in one or two products for a particular purpose rather than buying 5-6 brands for the same.

• Cell phone Recharge -

Opt for the correct plan according to your requirements. Exclude data plans if you use your WiFi more and similarly choose a better money-saving example - Instead of doing a monthly recharge for the same plan, go for a yearly plan which will save you a few bucks!

• Pack your food -

It’s time to stop buying lunch or snacks from your canteen or online food stores like Swiggy! Believe it or not, this tip saves a huge amount of money when calculated in the long run. Try to have your breakfast and pack your lunch and some snacks to your office. This will also help you to stay healthy and fit.

2) Limit Your Miscellaneous Wants -

These constitute nothing but our unwanted retail and online shopping, outing with friends, restaurant visits, etc. To keep them on the bay , we need to just control our desires a bit and think if it’s true and essential

Here are a few other tips to help you out overcome your unnecessary spendings -

• Try to pay cash instead of using credit or debit cards. This will make you feel resistant towards spending more money on buying things. If you are purchasing online always choose cash on delivery if you have that option.

• Cancel out unnecessary monthly subscriptions that you aren’t utilizing much. For example, you don’t need to have subscriptions for Netflix, Amazon Prime, and Hotstar at the same time! Right? And make sure you turn off “auto-renew” when you make a purchase.

• Say goodbye to all the email marketers who put in an irresistible temptation of sales or exclusive coupons. Simply unsubscribe from their mailing list if you can’t resist yourself from shopping. This will save a lot of money and a clutter-free inbox!

• Limit your salon visits. Girls spend a huge amount of money in salons. It’s good to do it once in a while but regular visits can make you bankrupt! Limit it by using homemade natural treatments which will hardly cost you anything.

• Party at home! Yes, you heard it right. Though preparing different dishes and post-party cleaning may seem a bit tedious, you can save lots of money from it! Restaurant charges will definitely be way more than your whole grocery list for preparing the dishes.

• Limit the number of times you go out to eat. If you were out with your friends or family 4 times in 2 weeks then reduce it to half i.e 2 times in 2 weeks. Don’t worry, you can definitely catch up on video calls when you miss them! This is also applicable for online food orders. Go for homemade food to stay healthy and to save some penny!

• Opt for a staycation - Taking a break from your work and hectic life is necessary. Going for a vacation once a year can make you refreshed and boosted! But if you are someone who loves to travel but can’t afford big vacations then, opt for a staycation instead. This will save you some money which you can perhaps utilize for the upcoming holiday plans!

• Stick to a single credit card. It’s really good to have a credit card to avail of different offers and benefits. But having more than one can put you in large debts. Also, process your payments on time to avoid paying interest.

• Invest in a good quality purchase. When you are buying things which you would be using for a longer period then, invest in good quality products. This helps you to avoid re-purchasing them thus saving you some bucks!

• Keep your bills and warranty cards secured without losing them. In this way, you will be able to keep track of your bill payments or to get some defective products replaced at no cost.

3) Go for More Savings and fewer Debts -

Now when you come to savings, the biggest milestone is on how you allocate them wisely. Prioritize your long term goals equally with your short term ones. Picking up the right savings tool is of utmost importance to achieve growth in money.

Here are the few of them -

a) Savings Account - Though the interest rates are less, still you save something every month to add up to your savings. Split your direct deposits and set automated transfer to your savings account.

b) FD / RD - These are best to fulfill your short term goals. Set aside some amount you can invest in an RD or FD based on your goals and requirements. Make sure you choose them wisely.

c) Stock Markets - If you are interested in stock markets and know how the platform works then go for it. This will provide you a fast growth of your savings if wisely invested.

d) Mutual Funds - Yes it's true that Mutual funds are subject to market risks but that doesn't mean you should not invest in it. There are a huge number of large caps that are lower at risk and you can invest in them. Go for direct online investing or through some agent/broker to start saving for your long term goals.

e) Emergency Funds - These funds are the most important compared to the rest. It helps to withstand/ cover the financial surprises that cannot be met by your regular salary savings. You can either keep aside a lump sum amount or opt for monthly installments for any medical-related or other emergencies. Investing in a good health insurance scheme can be an example of this.

If you have huge debts like home loans, educational loans, then it might affect your savings. Pay off the debts with higher interest to save more money in the longer run. Always make it a priority to settle your debts prior to the due date.

Try to avoid debts until and unless it's really essential. Instead of paying huge interest, it's better to invest that money for any good savings or investment plans.

Bonus Tips For Saving Money -

1. It's not always necessary to go by brands, you should always try for some generic products to add some savings.

2. Choose the subscription period wisely. You don't want to end up for a yearly subscription on Netflix if you just need to watch a single series! Hope you got it?

3. Try reusing your clothes or other items instead of buying a brand new one.

4. Sell the products you don't need anymore. You get some extra savings while the buyer saves some extra money! Nice right?

5. If you are living in a rental house, try using second-hand furniture to eliminate extra expenses.

6. Start putting your change ( coins) in a piggy bank! Dropping one or two rupees daily into a piggy bank can give you some addition to your savings.

7. If you are tempted to buy something, wait for 20 days to realize if it's really essential for you. And if you feel it is after 20 days then go for it.

8. If you are a shopaholic like me then you need to try this. Set a limit for your shopping expenses (like 2000 rupees a month) for both retail and online purchases.

9. Be you, don't try to replicate other's lifestyles.

It really doesn’t matter how much money you make—it matters how you spend and save it. The hardest thing about saving money is to get started. Try to realize the value of hard-earned money to stop you from spending them unnecessarily.