Big dreams rarely come cheap. An own house, top-tier education, a trip to a fabulous destination, — all these beautiful things won’t happen just by themselves. Unless you’ve already achieved the point where you always have enough money to turn your next dream into reality, you’ve got to save up for it. In case this is exactly what you were up to, here are several tips that will help you succeed:
Calculate your expenses
The first thing on your to-do list should be figuring out how much you spend — and what exactly you spend on. Keep track of all your expenses throughout the month: you can resort to countless apps designed specifically for this purpose or do it the old-school way by collecting every receipt. Then organize the collected data by categories — and prepare to get a heart attack once you discover how much your favorite to-go coffee actually costs you.
Make a budget
Once you have an idea of your monthly expenses by certain categories, you can organize them into a personal budget. Estimate how your spendings match up to your income, find out what categories you can save up on, and make an outline of your financial plan for the next month (or whatever period fits you most).
Obviously, you’ve got to take lots of factors into consideration to make a budget that will work for you, but with so many budgeting apps at your hand, it’s actually not that hard. Also, make sure that you have an emergency fund — this way your budget won’t belly up in case something unforeseen happens.
Find a way to cut back on your daily expenses
Now that you’ve realized that takeaway coffee burns a hole in your budget, you’ll possibly decide to brew it by yourself. Do the same thing with other unnecessary spendings: check in on your subscriptions, bring your own lunch instead of eating at work — all these small changes will severely reduce your costs without affecting your quality of life.
Get rid of your credit card (if you have one)
Budgeting 101: you can’t start saving up until you’ve paid off your debts. That said, owning a credit card makes you, well, a perpetual debtor. It also gives you only an illusion of ownership — you know you don’t really own things you’ve bought with it. As you keep it, it keeps you from achieving your goals. So why haven’t you got rid of it yet?
Think twice before making a purchase
You won’t become successful in saving money until you learn how to be mindful about what you buy — a skill hard to master in the era of reckless consumption. There is, however, one easy way to avoid compulsive purchases: you can simply sleep on them. Every time you get caught in the same old dilemma, just ask yourself a question: “why make a purchase right now if you can find the same thing for a lower price?”. Chances are, during that research time lose a desire to buy anything at all. Just don’t apply this trick to vital goods — water and stuff like that. 