How to start saving money?

Are you the one who plans to save at the beginning of each month but exhausts their funds by the month's end? Some may satisfy themselves with the thought that “often, things don’t work out as planned." However, others may search for tips on how to save money. Isn’t it? Despite being any of the above people, if you’re planning to save money, then continue reading to find out simple ways to start saving money. 

Before that, let’s first understand why saving money is important. 

Why Money-Saving Is Necessary?

As we know, the future is uncertain, as is the inflation rate. Therefore, in order to live a stress-free and peaceful life in the event of any kind of financial emergency or during an inflationary period, it is important to save money. Additionally, saving money will help you accomplish your long- and short-term goals, such as traveling, child education, marriage, business start-up, and more.

Brilliant Money-Saving Tips That You Should Know 

Some of the best ways to save money are listed below. 

• Create a Budget:

We tune in to television at the start of each fiscal year to learn about the government's budget. Isn’t it? A budget is more like planning how to use funds in a better way. You can start saving by creating your own budget, including your income, expenses, and goals. Besides financial stability, this comprehensive plan will help you evaluate your spending habits and take action on them. 

• Maintain Expenditure Book:

Always create a list of the things on which you spend your money, including even the least expensive ones. This will help you keep track of your expenses and cut unnecessary costs. 

• Categorise Your Needs, Wants, and Desires: 

The most important step in saving money is to understand the difference between needs, wants, and desires. Let’s understand the comparison between them with an example. 

Tina is a professional singer. She lives with her family in an apartment. She is the sole breadwinner in her family. One day, she wanted to attend the party and searched her wardrobe for something appealing. She couldn’t find anything to wear that would please her, so she thought about buying a new dress. Adding to this, she said that she desires to have a black gown for today’s party. In this example, Tina's basic need was “party wear." But her need switched to want and desire when she was dissatisfied with her existing collection. 

Thus, focus on fulfilling basic human needs like milk, water, food, and shelter rather than satisfying your wants and desires. 

• Set Your Saving Goal: 

Create your own mission and vision to start saving money. Understand whether you want to save money for the short-term or the long-term. Thereafter, define the objective that you want to accomplish in the future. This can be education, travel, marriage, buying accessories, and others. 

• Choose The Right Savings Plan:

Once you set your goals as per the duration, compare and choose from the different saving tools that best suit your needs. You can buy a term insurance policy that lets you create a pool of funds to accomplish future goals. Besides this, you can invest money in stocks, debt, fixed deposits, and mutual funds. 

Wrapping Up 

Most people say to follow the 30-30-30 rule to save money where 30% of your income is allocated for housing activities, 30% for basic necessities, and the rest 30% for your financial goals. Is that so? Saving money highly depends on income, family members, expenses, and many other factors. So, you can create your own saving rule by creating a budget and following it.

Also Read: Is Digital Gold A Good Investment