How to grow your savings on a limited budget?
Do you know where your money goes?
Before you figure out how much you can channel into savings, you need to know how much money you’re working with. Start by making a note of all your expenses for a month.
Then split your outgoings into two categories, as follows:
Start small, but start today
The good news is that the small, non-essential expenses are the easiest ones to cut down. Here are some examples:
- Buying a coffee every morning at the office
- Eating out at lunchtime
- Stocking up on things you don’t need just because they’re on sale
- Buying things on impulse at the grocery store
If you manage to cut an expense, don’t replace it with another one. Instead, set aside the money you would have spent. Even if it’s just five dollars a week, that’s a good start. Over time, you can probably save more, but at least that money will start to grow.
More tips to make saving easier:
A budget to help you stay on track
Once you’ve determined what your fixed and variable expenses are, you can set a budget for yourself. It doesn’t have to be complicated. Based on the month you’ve already kept track of, create categories for your different expenses, determine how much you want to allocate to each category, stick to your budget.
Don’t forget to have a category for savings!