Do you plan to be rich one day? Well, saving money is crucial to building wealth! Maybe you have a goal of saving up money for a new car, or to put a down-payment on a new home, or to save up money for an international vacation… Regardless, saving money is important for wealth-building and living the life of your dreams.
Two years ago, I made a decision that I wanted to be a home-owner by the time I was 30 years old. At the tender age of 24, I thought that goal was a long-stretch because I wasn’t in a position to save money towards a home – or so I thought.
One full year after writing that goal to purchase a home, I closed on my very first home! How’d I do it?
- Created a budget and stuck to it.
- Increased my streams of income.
- Monitored and decreased my spending.
- Stopped using credit cards and repaired my credit.
- Became a master of saving my money.
Today, I’ll focus on that last one: saving your money! Here are the 4 money-saving tips that helped to completely transform my life and my bank account:
1. Understand how much money you’re making & spending.
Understanding how much money comes in and goes out of your bank account each month is key to saving money. First, you need to know exactly how much money you make on a monthly basis. From there, you can see how much money you are spending each month.
Your spending habits are where you’ll find room for you to save more money. When you look at your spending habits in detail, you are able to see what types of things you spend your money on. Typical things that people spend their money on are: food, bills, medical expenses, shopping, going out, etc.
If you want to save MORE, you have to spend LESS. You have to know exactly how much money you spend each month to understand if your spending is too high. Pay attention to what you spend, and you’ll be a much happier camper at the end of the month.
2. Eliminate any expenses you don’t need.
After you take a look at your spending habits, it’s imperative to examine what types of things you spend your money on that you don’t really need. Once you figure that out, you can easily eliminate what you don’t need.
Expenses you may not need include subscriptions and memberships that you don’t use. For example, gym memberships, Netflix accounts, Pandora or Spotify premium, Audible accounts, are all great examples of things you’re spending your money on that you might not be getting the most use out of. If you’re not using them, just cancel it!
If you have memberships that you do use, but not that often, negotiate a less expensive price with the company. With this one, you’ll have to boss up and threaten to close out your membership if the price isn’t right. They’ll be willing to keep your business at a cheaper rate than to let you go as a customer completely.
3. Limit eating out, cook your food, and shop at Aldi!
One of the major ways that Americans waste money is with eating out. Instead of buying lunch and picking up dinner on the way from work every day, cook your food at home! This requires preparation, but it’s worth it in the long-run.
You’re able to save a lot more money when you shop for your groceries, specifically at less-expensive grocery stores like Aldi. Their food has the same level of quality, with a much cheaper price-tag.
Let’s say you work 5 days a week, and you spend $15 on lunch every day for the whole month. In that case, you’re spending $75/week and $300/month on lunch alone. With that same eating pattern, you’d be spending $3,900/year just from eating out for lunch. Imagine the amount of money you’d be able to save if you packed your lunch from home instead.
4. Stop shopping for what you don’t need.
I know shopping is fun, therapeutic, and fashion makes your look good, BUT, you have to learn to be disciplined about what you spend your money on.
If I’m honest, shopping was one of my biggest pitfalls when it came to saving my money. It’s hard to say NO to the things that you want, but that’s the purpose of discipline. You don’t NEED a new pair of heels every time you get paid. You don’t NEED a new outfit for every event you go to. You don’t NEED that candy at the checkout counter. You don’t NEED that $1.25 water from the vending machine. You don’t NEED three new pair of sunglasses for the summer.
You have to understand the difference between what you need and want. If you look at your spending habits and are honest with yourself, there are a lot of things that you don’t really NEED that you’re spending your money on. That’s where you’ll find room to save more money instead of spending your money on your immediate desires.
It’s time to boss up and take control of your money!
Remember, you’re the boss of your money! Your money isn’t the boss of you. You have to get serious about saving money if you want to be rich one day. These are habits that will help you become a better rich person for your future.
So, what decision are you going to make today? Are you going to continue to let your money be the boss of you? Or are you going to boss up and start saving more money for your future?