Saving money is a skill we must master, a skill we need to exercise on a daily basis.
You might say, "Wait, I don't need to save money" but the reality is, that you definitely should be saving money. But doing that is something that doesn't come naturally to us. Us, humans really like spending money, brain scans show us that when you buy something, the reward centre of the brain lights up, same chemical brain process you would feel like when experiencing an orgasm or when you would win a race for example. A little hormone called "dopamine" is released in the brain whenever that happens, so the same happens when you spend money. So spending money feels good for us, but is it good for us? Well depends where you are spending it first of all. But more times than not the spending you are doing is an impulsive purchase to experience that little moment of good feeling. But this is easier said than done. In this article, we give you tips on how you can cut down on some costs and how to save some cash.
Say goodbye to debt
Debt is an amazing tool when leveraged and used in the right moments and times.
But it's a very double edged sword. Interest rates take money out of your pocket week by week, month by month, year by year. Debt is really something that can add up in the long term. You might not notice it right away, but debt is really something you should try to stay away from in the first place, unless you really have that once in a lifetime opportunity. Then leveraging debt to gain afterwards is a smart choice. If you are currently in debt, no need to worry. You can strategically attack your debt. If you have multiple loans/debt open you attract the one with the highest interest rate. However if that debt is way bigger overall than the rest you should maybe look into paying off another one earlier. If you cannot pay back your debt you need to seek help with that as early as possible. If you search online a lot of results will come back to you. There are many debt plans and strategies out there. Dave from ramseysolutions.com is well known for this.
Cancel automatic subscriptions
You should follow this saying "focus on the things that put money in your pocket, not things that take" If you follow that simple saying, you'll find yourself to be in a very good place financially. Automatic payments/subscriptions really can be sneaky and add up.
They are sneaky about it, hard to cancel and do anything to keep you there.
Try to cut down on these. Or atleast really budget with those in mind. Don't ignore them like "oh it's nothing". Believe me, it is something. Using a banking app that allows you to create virtual one time use credit cards can help you declutter. Also take full advantage of free trials, create new emails etc.
Ditch branded groceries
Now, before you throw out your favourite coffee bean brand, hear me out.
Branded food or consumption is proven to be the exact same or even better in terms of quality. In many surveys, people cannot even tell the difference between branded food and generic food. So buying branded food is just not a good choice financially, and there are also arguments from the philosophical world saying that it adds clutter to your life and that you are a billboard for companies. Also, in terms of nutrition are, the values almost identical. And if they are not, there might be another supermarket out there selling a generic product that is identical. You'll also find that you start to value the things you buy more.
And you might see a downtrend in the actual food you consume.
Costs of electricity and gas
Now, this one can be hard to do. But it is definitely worth it. Cutting down on electricity and other utilities really pay off in the end. Turning the thermostat down a little and wearing a hoodie from time to time never killed anyone. Things like having cable tv, switching it out for Netflix or getting a Chromecast and watching Youtube. All these little things turn into big things. Getting smart bulbs in the house because those have built-in timers and other features that are going to save you hundreds a year. How much I dare to say, this all depends on how extreme you go on this one.
Use money-saving banking apps
This is a super easy one and requires little to no effort to implement today!
Using apps like Revolut or Starling allows you to save money without even having to think about it. Not only do these money-saving apps have built-in budgeting and overview weekly but also they have this game-changing feature that allows you to let transactions be rounded up to a decimal whenever you buy something, just like you would save all the spare change you would have with cash, this is such an easy to do step to save money. Also, an app like Revolut allows you to change the intensity of that.
Extra income or unexpected income
This is a big one. Almost 90% of people see extra income or unexpected income as a bonus that they can spend right away. What you should be doing is, saving that money since you do need it. It was unexpected; therefore, you could perfectly live without it. Saving this money or investing this money is the best course of action here. Buying things impulsively might really feel tempting, but this, however, is just pure exercise, patience, and skill.
Something we all often lack when it comes down to money business.
People also always seem to feel themselves entitled to everything like they deserve it on a plate.
This article has been written and constructed by Andre Witzel, full-time forex investor and writer. Check out my website.
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