Sadie Holloway writes about enjoying the good life while living on a modest income. She loves finding creative ways to save money.
Being able to save for your retirement, a special vacation, or a dream home doesn't have to depend on having a big salary. Here are some tips on how to save money to reach your retirement or nest egg savings goals even with a modest income.
If you want to ease stress, reduce debt and retire early, managing your money wisely is the only way to achieve your financial goals. Not everyone will win the lottery, but everyone can find creative ways to save money and reduce living expenses.
Successfully saving money will depend on your personality, your lifestyle and your willingness to make a positive changes to reach your goals. Financial freedom will also depend on:
- how much debt you currently have
- whether you have a steady source of income from a job, you work from home or you are going to school to upgrade your skills
- your social life and how much money you spend with friends
- your recreational and leisure activities
- your understanding of basic financial management and budgeting.
One of the best ways to start saving money is to take a good look at your financial goals. Are they consistent with your day to day living? What do you want to do with your life? In five years you might want to have enough money to buy a house. In ten years you may dream of taking a long vacation or changing careers. In twenty years you may want to be completely debt-free and living on an income of retirement savings and pension benefits. Will taking a sunny vacation every other year, instead of every year, help you reach your goals faster? Figure out what you are willing to sacrifice to get what you want.
Once you have made up your mind to change the way you handle your cash, try some of these easy tips for saving money. (They're also kind of fun, too!) Think of saving money as a worthwhile challenge that will make your life easier.
1. Get your home and office in order.
You can’t save money if you're disorganized. It’s as simple as that. Clutter is a big barrier to achieving your goals because it attracts waste. It takes up space and keeps you from staying on top of your money and what you are spending it on. For example, if your kitchen cupboards, closets, pantry and medicine cabinets are cluttered, it will be hard to find the things you need. Have you ever thought you were out of something, gone off to the store to replenish it, and then come home to find you already had a full supply of that item pushed into the back of the cupboard? Take stock of your household goods so that you don’t spend money on things you don’t need.
A well-organized kitchen will also save you money by preventing unnecessary food waste because you'll be able to keep track of expiry dates and use food up before it goes bad and has to be thrown out. Did you know that up to 40% of the world’s food supply goes to waste due to poor handling and processing practices? Do your part and stop wasting food and money! (source: http://www.guardian.co.uk/environment/2013/jan/10/half-world-food-waste)
Keeping your home organized will save you money by making the things that you do buy last longer. For example, when you buy a new appliance, do you fill out the warranty card right away or register the product online? Do you put your purchase receipts in a handy file so that if anything goes wrong you can return the item or at least get it repaired under warranty? Taking care of your purchases, returning defective ones and having appliances serviced before the warranty expires are smart, no-brainer ways to save money. (It also keeps things from ending up in the landfill when they could easily be repaired at little or no cost.)
2. Try one new money saving tip a month.
You’ve got nothing to lose and everything to gain by taking a new money habit out for a test run. If after one month you find that the new money saving trick works for you, do it again the next month, and keep adding new money saving tips each month until each one becomes a habit. Gradually changing your spending and saving habits is easier to do than trying to give your entire financial life a giant make-over.
Where can you find useful money saving ideas? Read financial planning and budgeting books. Borrow these books from the library, don’t buy them! (There’s a money saving tip for you right there: borrow things instead of buying them!)
- Look for YouTube videos, read money magazines and follow financial columnists.
- Join a MeetUp group for people who want to learn how to hang onto more of their hard-earned cash. Many of these money-talk support groups are free to join and they're filled with people just like you!
- Follow money blogs written by real people who have turned their financial lives around by changing their spending habits. Ideas and inspiration are all around you. Finding ways to cut back on expense is easy—the possibilities are endless—the hardest part (and the part that is totally up to you and how motivated you are) is to turn those smart money tips you find into your own smart money habits!
- If you feel like you're really struggling to make ends meet, and you need more substantial help with your financial situation, consider consulting your nearest credit counselling agency. These are non-profit organizations that provide support, information and assistance when you're faced with mounting debt. Credit counselling agencies are there to help you solve your financial woes and make sensible decisions about what to do next. Make sure that you consult a non-profit credit counselling agency, not a collection agency or some outfit that will charge you a fee to help you get rid of your debt. Legitimate credit counselling organizations do not charge fees for their counselling services.
Tips on how to save money can be found almost anywhere. After all, money management and family budgeting are hot topics. Most people want to retire some day. Most people want to feel financially secure so that they can take care of their families, donate to charity, and pay for unexpected medical expenses.
Don’t be ashamed to admit that you need to learn better budgeting skills. When you get out there and start talking to other people about saving money stick to the groups and people who make you feel good about your goals. You should be inspired, uplifted and empowered by all the good money ideas you are getting. You shouldn’t leave these groups feeling ashamed, embarrassed or dumb. If you do, that’s a sign that you need to find another money-management support group! Staying focused on your money goals will require a positive attitude. Connect with people who help you feel good about your goals and want to see you achieve them. Avoid toxic people who drag negative energy around with them wherever they go.
If you feel like you're really struggling to make ends meet, and you need more substantial help with your financial situation, consider consulting your nearest credit counselling agency.
3. Put your money-saving goals into perspective.
Link your desire to improve your financial situation to something greater than you and your bank account. (The food waste example earlier is a good start.) Get involved in political movements that remind you to keep your reckless spending in check. Just like feeling connected to other people who share your saving goals can keep you motivated, so too can tapping into some big-picture ideas about how and why we spend too much money. Understanding how some of our bad shopping habits are harming us, the environment and less fortunate people on the other side of the planet can be strong motivators to keep your spending under control.
Have you ever heard of “Buy Nothing Day?” It’s one day of the year where consumers are encouraged to go without buying anything for at least 24 hours. The idea is that by consciously not buying anything, collectively we become more aware of how our spending habits can have a negative impact on the world. Visit www.buynothingday.co.uk for more information on this event. The site includes tips and tools and other fun goodies (for free, of course!) to help you celebrate this anti-consumerism event.
Think of saving money as a small gesture towards making the world a better place. By reducing frivolous spending on consumer items that destroy the environment, you can use the money you've saved and give it to a charity. You could use your savings to take time off work (or quit altogether) and volunteer helping people in need. Could you observe your own buy nothing day once a month? How about once a week? You’d be surprised by what this simple act of fiscal restraint can do to improve your monthly cash flow!
4. When you work towards your goals, aim to have fun.
Don’t take yourself too seriously while trying to save money. Find ways to laugh a little as you practice the art stashing your cash. There’s no point in trying to improve your financial situation if it makes you feel miserable and depressed all the time. Feeling like you're always broke and can’t pay the bills on time is stressful. Money problems can be hard on your marriage, too. Feeling overwhelmed by your mortgage, student loans or car loans can affect your health. That’s why it’s so important to stay positive as you strive for your goals.
Try to find the humor in your situation every once in a while. You’re not alone. There are many writers, comedians and motivational speakers who share light and humorous stories about being broke, spending cash like a fool or making dumb decisions about money. (One of my favorite stand-up routines is “Stuff” by the late George Carlin. His language isn’t for everyone, but he has a way of getting to some universal truths about how we humans sometimes behave.)
The next time you are tempted to...
|Do this...||Try this instead...||And save this!|
Go out for a 3-course meal at a restaurant
Share a few small, but filling appetizers and then have a decadent dessert at home
Buy an expensive designer gift for your friend's birthday
Invite her over for a tea party and give each other manicures
Skip a payment on your credit card
Don't do it; it's not worth it. Always make your minimum payment (at the very least) and avoid expensive interest charges.
Sharing stories about money, financial loss and recovery, and inspiring rags to riches triumphs can help you stay motivated on your path to financial freedom. Money stories remind us that we are only human, that we are not perfect and that at the end of the day we all want the same thing: to have a happy home, a meaningful life and a healthy planet we can pass on to future generations.
Money talks! (But who's really listening?)
© 2013 Sadie Holloway
Shing Araya from Cebu, Philippines on September 15, 2019:
Really helpful. Thanks