“Up to a point, a man’s life is shaped by environment, heredity, and changes in the world about him; then comes a time when it lies within his grasp to shape the clay of his life into the sort of thing he wishes to be… Everyone has it within his power to say, this I am today, that I shall be tomorrow.” - Louis L’Amour
1. When beginning your journey and learning how to save money your commitment will make or break your success. To ensure that you have the best possible chance of success write down your short term, medium and long term goals for saving money. Focus on the short term goals to begin with. A successful journey begins with small steps.
Write goals and put them on the fridge so you see them every day, write key dates (milestones) into your wall calendar and in your diary or planner.
2. If you are focusing on paying debt off first you will never successfully learn how to save money. Always pay yourself first, from your earnings after tax take a set percentage every time you get paid and keep it, and never spend it. Invest this set percentage where it will work for you and the interest will compound overtime. This will get you on to the road of personal wealth and financial health.
Ideally you would set the percentage to 10%. Here is an example, say that you get paid $300.00 every week in the hand, the first thing you are going to do with your money is to pay yourself first, that is $30.00 which is 10% of $300.00. Put this 10% somewhere where it is hard for you to get to, as you will be tempted to spend this money in the future. This point is an important aspect of learning how to save money.
3. Identify all of your debts, what do you owe on store cards, creditcards, personal loans, car loans, mortgages and so on.It is important to know where you stand with debt when learning how tosave money. Prioritize your debt, what needs to be paid off first, canall be paid off via installments simultaneously?
If you are finding it difficult to make payments talk to your lenders and see what options maybe available to restructure the loans, put an agreed plan in place and this will help with your quest to discover how to save money.
4. Identify your income and reoccurring expenses (outgoings), now you can draw up a simple budget. A simple budget will allow you to see when money is coming in and going out, and provide you with the ability to pinpoint overspending and where further savings can be made.When learning how to save money your budget is a critical piece of the equation.
5. When learning how to save money it is critical to track your progress, this means recording your income and outgoings, monitoring your actual transactions against your budget.
This step allows you to track your progress on a weekly or monthly basis. Yes it takes effort to do this, but in order to learn how to save you must learn how to control your outgoings this step is critical to record actuals and then report on them to see where you are at any given point with your finances.
6. It takes commitment to learn how to save money but once the habit is formed you will find it will get easier and easier. Remember every time you purchase something make sure you ask yourself "Can I livewithout this?" if the answer is yes then the product you are about to buy is likely to be a want - don't buy it. Concentrate on needs first and if you have money to spare then wants (at least the highest priority wants first).
7. It’s a tough road when learning how to save money. Sanity money or your allowance is where you budget weekly money for you to spend onwhat ever you want. It might be only $20.00 per week or even more, how ever much you think you can afford. This gives you money to spend on your wants and leaves the remainder of the cash for your needs.
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