One thing that everyone believes in, is spending less and saving more.
Now that is easier said than done, this is especially true after the covid 19 pandemic. However, there are some simple and effective ways we can take to save money.
Pay yourself first
Aim to save at least 10 percent of your earnings before tax. Treat your savings like how you would treat a bill. If you do this, saving will become a habit and in time you will have built up that emergency fund or nest egg.
A fantastic way to make saving easier is to automate the process. Create a direct debit on your bank account, set an amount you can afford and each month that amount will be automatically saved.
Review your medical aid and insurance policies
Did you know you can save hundreds of dollars a year by reviewing your medical aid, insurance and bank charges. These can be negotiated to better rates and finding better offers.
Below are some of the main expenses in a household:
- Medical aid
- Home building insurance – check to see that you are not over-insured for you household items and home value.
- Car insurance –a cars value usually depreciates over time, check with your insurance company to see if the charges can be negotiated.
- Bank fees – check other latest offers that become available each year. It could save you a lot over the year.
Grocery shopping spending
The best way to start saving on grocery shopping is to set a monthly budget. Stick to this limit by planning your meals in advance. List all items needed and then buy them in one trip.
Limiting the number of trips to the shop is key to avoiding temptations and unnecessary spending.
Also be wary of specials. They can appear to save you lots of money however they can also lead to impulse buying. It is recommended to purchase only items that you need when they go on special.
Pay off credit card debt
Credit card debt can be taxing on your psyche. Focus on paying off your debt one card at a time.
Arrange the debt by interest rate and amount and pay off the cards with the highest rate first.
Make sure to pay as much as you can every month. Also, a good practice is to pay more than the minimum needed, this will reduce the amount of interest you will pay over time and saving you money in the long run.
Switch to a healthier lifestyle
Unhealthy habits can be expensive and unnecessary.
Cigarettes and alcohol expenses can add up a lot at the end of the month. Sweets and those expensive Capaccino habits also help rake up the expenses.
That same money saved by reducing the unhealthy habits can be used to pay towards other much need expenses.
Also, by reducing the unhealthy habits you can also spare yourself from various illnesses and might make you eligible for lower life insurance premiums.
Home / mortgage loan secrets
If you have a home / mortgage loan, consider paying extra on your monthly bill, the extra amount can significantly reduce the total interest you pay on your bond and shorten the bond repayment period.
Be sure to contact your bank to see if this is possible on your bond and if the extra amount is being allocated towards the total repayment amount and not just being kept aside as extra money.
Be patient with yourself
Following a strict budget from day one is unlikely to happen no matter how disciplined you are.
Stay realistic, remember to accept the small errors, and build small rewards along the way. This will ensure you have a good mindset and keep you going on the right path.
