How to save money: with a small salary + ways
How to save money? The question is always relevant. Because reasonable savings allow you not to experience financial problems even with a small salary. But many people do not notice how much money is spent daily on buying useless things and paying for unnecessary services.
Having got rid of the bad habit of overpaying, you can save money for something really necessary and useful. To stop living from paycheck to paycheck, it is enough to follow the simple rules of rational distribution of the family budget.
5 steps towards financial literacy
When the decision to cut costs is finally made, there are five simple steps to start with:
Step 1 – Change settings
Some choose expensive goods and services, as they are ashamed and embarrassed to save money in front of others. Do not confuse economical people with greedy people. In fact, the ability to spend wisely is a hallmark of a mature and accomplished person. To be convinced of this, it is enough to read the biographies of millionaires. Most of them are not used to throwing money away and are proud of this skill.
Not always an expensive thing is better than a cheap one. Branded clothing and footwear, advertised brands of goods and high-end services often do not meet the expectations of buyers. Their high price may not be due to quality, but to marketing campaign costs. Savings start with replacing popular products with really high-quality ones.
Step 2 – Negotiate with all family members
Discuss the new approach to spending with everyone in the household. This is an important rule, since it will be possible to accumulate money only by joint efforts. If not all relatives are ready for change, try to motivate each of them. To control the spending of family members, follow these recommendations:
- link additional bank cards to one main card, through which all payments will be made;
- distribute cash among family members according to their expenses;
- encourage a rational attitude to finances;
- set a positive example.
Unfortunately, in educational institutions people are not taught financial literacy. By following these recommendations, you can clearly show children how to save wisely.
Step 3 – Plan your budget ahead of time
Divide your family budget into spending categories. Because by allocating a certain amount for each category, it is easier to control the outflow of money. But you need to plan spending for at least a week, each time adjusting the amount in accordance with the upcoming circumstances. For example, if you have dinner with guests next week, the amount for grocery purchases should be increased.
The family budget of most people consists of the following categories of expenses:
- buying food;
- payment of utility bills and communication services;
- purchase of clothes, footwear, household appliances, furniture, etc.;
- travel expenses on personal and public transport;
- fulfillment of credit obligations;
- spending on health (medicines, visits to doctors, gym, massage room);
- buying gifts;
- vacation expenses;
- purchase of household goods;
- repair, maintenance of comfort in the house.
The distribution of expenses between these categories in different families is different.
Step 4 – Prefer cash
Psychologists believe that using bank cards, a person loses the feeling of an outflow of finances. When paying for goods and services with real banknotes, the level of cost control increases. This rule also applies to credit cards. It must be remembered that any loan involves an overpayment in the form of accrued interest. It may take some time to fully withdraw from loans, as saving money with a small salary is not easy.
If you are not ready to give up cashless payments, choose bank cards with cashback. The return of even a small amount of expenses to the account will become a tangible bonus if you regularly pay for goods and services with a card. You should also carefully consider the study of the conditions for registration and use of a banking product. Sometimes banks prescribe hidden payments in the contract.
Step 5 – Write down all your expenses
People are often too lazy to keep a diary, writing down expenses for the day. This is one of the common mistakes, as it is impossible to save your money without control. With the advent of smartphones, budget control has become much easier thanks to special applications and programs. After installing such programs on the phone, the user is prompted to make all purchases, payments for services and bills in the application.
Keeping such a financial diary gives a person two options:
- discover useless purchases and abandon them in the future;
- predict future expenses based on previously obtained data.
At first, you may forget to write down every purchase, but soon it will become a habit. In order not to quit what you started halfway through, you will need perseverance.
Rules for saving on food
Many people spend most of their income buying food. However, they do not eat delicacies or exotic foods. This is due to the inability to properly stock and go to grocery stores. You need to pay attention to this, since you can save money for an expensive purchase if you save 20-30% of the grocery budget every month.
This way to save money includes 5 rules:
- Products that are stored for a long time, buy in bulk. This will help save 10-15% of their cost. Such products include cereals, pasta, tea, coffee, juices, canned food.
- Do not stockpile perishable products. The average family throws away about 20% of purchased food due to spoilage. Buy perishable goods daily in small quantities. It is better to buy something that is not enough than to throw away food, and with it, money.
- Go to the store full. Hunger subconsciously makes us buy too much. To avoid this, before buying food, it is better to make a list of the necessary and strictly follow it.
- Don’t buy packaged and cut goods. If you can buy vegetables, fruits, sausages, cheese or cereals by weight, give preference to this option. Packaged products are usually more expensive, even if the quality is the same.
- Take food with you. It is cheaper to eat homemade food at work, study, or on a trip than going to cafes or restaurants.
Saving on food will also help maintain health if you refuse harmful convenience foods, chips, crackers, etc.
How to save on tariffs?
A significant part of the family budget is spent on utility bills. To control costs, you should install meters. From 2020, people who don’t follow this advice will pay higher utility bills. Reducing the consumption of water, gas, electricity is an environmentally friendly way to save money, as you can save money at the same time as saving natural resources.
To pay less for the phone and the Internet, carefully read all the tariffs of the operator. Often, the company automatically connects new subscribers to an unfavorable tariff. Taking into account the individual characteristics of the use of communications, you need to choose the most advantageous package of services for yourself. Often discounts are provided to those who are willing to pay in advance for services. Because by paying in advance for several months, you can save up to 20% on the Internet.
Modern instant messengers and social networks also make it possible to reduce the cost of mobile communications. Because sending messages and making calls over the Internet is a small savings. But people who are forced to use their mobile frequently will feel it in a few months.
5 rules of economical shopping
In order to regularly buy clothes, shoes, household appliances, electronics, many people have to save up. Psychologists have developed 5 rules on how to save money with a small salary and buy everything you need:
- Don’t make purchases on impulse. If you have a desire to purchase something expensive, think it over for a few days and discuss it with your loved ones.
- Use bonus cards, discounts, discount certificates. If you are going to buy an expensive item, but there is no store discount card, contact your friends and acquaintances. Perhaps someone will agree to lend you their discount.
- Do not buy a thing in the first store. Compare prices in several places, find the product you are interested in on the Internet. Because that way you’ll be better prepared to buy.
- Refuse new products and brands. Because things from a new collection, like new models of equipment, are usually expensive. But already a few months after the presentation, they can be bought cheaper.
- Pay only for the functionality you need. Expensive models of household appliances and electronics are equipped with dozens of functions. Before buying, consider what features you really need and what you should not overpay for.
A smart approach to shopping is saving the family budget. To avoid emotional purchases, make a spending plan before shopping and limit the amount of money you carry.
Budget holiday rules
The phrase "budget vacation" causes only negative associations for many. In fact, with a rational approach, you can organize an inexpensive and enjoyable trip for the whole family. For those who are interested in how to save money with a small salary and not indulge in rest, experts advise adhering to the following rules:
- Plan your trip in advance. Because buying plane or train tickets 5-6 months in advance, you can save up to 50% of their cost.
- Compare hotel prices before booking. When choosing a hotel, find it on several sites and compare prices. Because it allows you to find a better deal.
- Avoid high season and holidays. Prices for flights, accommodation, meals and excursions increase by 30-40% on holidays and peak season. At the same time, the resorts are overcrowded with people during this period. It is much more comfortable and cheaper to rest a few weeks before or after the peak period.
- Listen to the advice of experienced travelers. In preparation for your trip, check out travel forums and blogs. They will suggest shops, cafes, restaurants with the best prices. Usually these are places not promoted among tourists.
The level of a person’s expenses is strongly influenced by his lifestyle. By quitting smoking and drinking alcohol, you can save not only finances, but also health. The same rule applies to physical activity. If you can walk to your place of work or study, do not use public or private transport. Physical activity in this case will improve health and save the budget.
Following the above tips, you do not have to think about how to save money for a happy life. Because by refusing overpayments and useless purchases, you can quickly improve your financial situation.