Yes everybody loves money—well, spending money. A lot of the things people buy are not needed: new clothes, gadgets and night life are not always necessary. The economy is rough, getting jobs is tough, so you need to value your money. Sadly, many people don’t have a high a financial IQ. They know how to make money, but not sure how to save and spend it. If your able to manage your money right–you will be able to treat yourself more comfortable and more often in the long run.
Realize that you have a problem. The first step to solve any issue is to be self-aware. It’s easy to be in denial, so if you’re conscious of your habits then you already won half of the battle. When you’re aware of the negative spending habits, you start second guessing every cash exchange, swipe and proceed to checkout click. Even if you continue to spend carelessly, the “should I do this” thought will linger in the back of your mind.
Open up a savings account. When preserving money, you need a savings account. It’s safer than holding cash in your house and it’s easier to manage. Pick a bank of your choice and physically go to that bank and sit down with a bank representative. They will thoroughly discuss everything you need to know about your new account; it’s easier to understand when speaking face to face. Have them walk through with you and set up an online banking account to help manage your money with that bank.
Set up a Mint.com account. It’s a free personal finance website that can guide you into saving money. It breaks your monthly budgeting down to a science. It combines all of your bank accounts and tracks how much you spend and where you spend it. For example, it tells you how much you spend on gas, food, bills, cash—everything you can name money wise.
Separate your wants from your needs. It’s obvious that you can’t avoid spending money on certain things: bills, children and food is a must. Other things you can live without. You don’t need to upgrade your phone when it is due—you want to upgrade it. You don’t need to buy that extra Big Mac—you want the extra food. You don’t need the premium cable package when you’re barely home to watch TV in the first place—you want the premium cable package.
Create a new zero. After you budget your monthly expenses and cut back from all the things you don’t need, set a new benchmark in your savings that you cannot go below. For example: if after all your expenses each month you usually end up with $500 in your account—act like that’s zero. Do everything in your power not to have your account fall below $500. Now lets say time passes and you save a little more money, make $550 your new zero and keep doing this system forever.
Pay yourself before you pay Uncle Sam. When people first get their paychecks or if it’s the time of the month that their bills are do, they are quick to throw all their money at those companies they owe. Hold on for a second—take a step back and relax, ease off the pressure. The first thing you do when you get your money is put a certain amount that you’re comfortable with into your savings. Before any bills are paid, before any money is spent, give yourself the money you worked hard for before giving it to the government. Realistically, what’s the worst that happen if you’re a few days late when your bills are due? Credit yourself first.
Develop Will-power. You will see commercials, you will see other people with nice things, and friends will tempt you to take a night out of town. There is much power in saying the word no. Stay strong and keep reminding yourself that you’re trying to value your money and not let it go to waste.
Set goals. Much like step five, have a benchmark. This is important: it gives you a standard. Take out a pen and paper and write them down. You will only go out to eat once a month—goal. You will make sure to cut off the lights every night to save electricity–goal. You will walk to certain places to instead of driving to save gas—goal.
Don’t be afraid of coupons. When shopping, plan before you buy. Grocery shopping, book shopping etc. When you’re in need of an item, take your time before purchasing. Go to the best place so you can get the best deal. Don’t be afraid to be called cheap, your saving money. Groupon is an excellent place to look for coupons and if you are online shopping, go on retailmenot.com. Saving a couple bucks with each coupon will add up more than you think in the long run.
Treat yourself. After you trained yourself in this new found saving habit, there is nothing wrong with spending a little bit of money on yourself. You worked hard for this paycheck; you deserve it. Remember, be responsible and don’t forget your priorities. Do not spend more than you make—this is an ultimate no. Stay within your budget, stay within your living means, and enjoy the things that you buy yourself.