Start small. The saying is that “a penny saved is a penny earned”.
As your budget management skills develop over a few months, you will find yourself with more cash in the bank at the end of each month.
Set a savings target. Identify what you want to save money for. The first consideration should be emergencies.
Use your savings only for their desired purpose. Build monthly savings into your budget and try to increase them over time. Open a separate deposit account to use only for your savings.
- Build your savings plan into your budget.
Once you set aside money in your budget for savings, you should deposit into a separate account immediately. Over time, as you eliminate your debts, you can add more to the savings pool.
- Keep a piggy bank.
Put pocket change into the piggy bank on a regular basis until it is full. ONLY break the piggy bank at the real bank and deposit the cash.
- Live cash!
When you practice keeping a budget, you get to know exactly how much money you spend every week. Then you can draw cash once a week for the whole week, or even once a month. Think of all the banking fees you can save as well.
- Involve the entire family in the plan
Regular family meetings to discuss the family’s budget and savings plan will make life a lot easier. If everybody works as a team, everybody learns and everybody becomes richer.
- There are several other basic exercises to free up cash to put towards savings:
- Write your shopping list from your budget. If it is not on the budget, it does not go onto the shopping list. Buy only what is on the list.
- Join a lift club to and from work where you can.
- If you use public transport try speak to your employer about creating a subsidised transport service for employees who live near you. Tell the employer, that nobody will have an excuse to be late for work.
- Stop buying lunch at work!!! A take away lunch can cost R20.00. That is R100.00 per week or R500.00 per month. A home-made sandwich and an apple can cost R5.00 per day or R100.00 a month.
- Do not immediately replace grocery and household items when they run out. Do so only with the next pre-planned shopping trip and as part of your budget.
- Alcohol, tobacco, sweets and eating out are expensive and they can make you sick. Why waste the money?