Hey Owlets,
Since stepping into the world of being a real adult with bills to pay I like to think that I’ve gotten very good at saving money. There’s nothing quite like the sense of impending doom lurking at the end of each month to motivate you into putting every penny you possibly can to one side. However, if you’re not like me and the thought of another month of bills doesn’t fill you with dread, there are some less scarring ways to motivate yourself into saving money!! If you find that your money just isn’t going as far as you’d like, here’s a few ways to help you stay on track.
Remember What You’re Saving For
This is probably the most important thing to do when trying to save money. If you’re just saving money for “the rainy day fund” then it’s going to be too easy to just dip into your savings if you’re having a hard month or feel like treating yourself. If you have something tangible in your mind that you really want, it’s going to make it much easier to save up. Whenever you feel like dipping into your savings for a non-essential purchase, remind yourself that you’re taking a step back from getting what you really want and by taking the money out for that non-essential purchase it’s going to take you longer to reach your goals. Picture the item/experience that you’re saving for and focus on how good it will be to finally be able to afford it and that should help you stay on track.
Work out How Much you Need to Save
It sounds obvious when you think about it, but if you’re saving money for this thing that you haven’t thoroughly researched it’s going to be too easy to take money back out of your savings or to never put it to one side to start with. At the end of the day, if you don’t know how much money you’re aiming to save, you won’t feel as bothered about taking some out. This is particularly important when you’re saving for something big like a house deposit, and with house deposits it’s particularly important that you do research in the area that you’re looking to buy in. You need to look at how much the average prices are for the house you want to buy. Go onto your country’s local bank websites to see how much they would be prepared to lend you and it should tell you how much of a deposit you will need. From there you will have a rough estimate of what you will need to save, although it’s always best to save a little extra just to cover any unexpected fees or increase in house prices. It’s also important to look at the mortgage rates and how much interest you will be paying. I absolutely can’t do justice explaining this, but here’s a great mortgage calculator that explains it and tells you everything you need to know. It fully breaks down interest rates, the best types of mortgages to go for, and how much interest you’re likely to pay on what you’ve borrowed, so you know what your monthly repayments are likely to be with each different type of mortgage. At the moment I’m nowhere near buying a home, but I know a lot of you are coming up to that stage so hopefully it helps!
Work Out Where your Money is Going
If you don’t know what you’re spending your money on, you’re not going to know where you can save. There are several ways to do this, depending on how you’re most comfortable working. Personally, my mobile banking app tracks my spending and will tell me where I’m spending the most money. It also allows me to set budgets for each category of spending - it suggests budgets that it thinks are doable but you can set a stricter or more lenient targets depending on how quickly you want to save and what you think would fit in best with the specific constraints within your lifestyle. If you want a more tech-savvy approach there are apps that help you save by automatically rounding up each purchase, or by transferring any money leftover in your budget into your savings account at the end of the month. If you want to take the offline method, then sit down with a pen and paper, write down how much you spend each week and what you spend your money on and then work out where you can cut back. I go into more information on this in my “Easy Ways to Save Money” article, so if you need help cutting down then go give that a read!
Pennies Make Pounds
This sentence would drive me mad growing up because I was so sick of hearing it but, like most things your parents tell you, you realise how true it is as soon as you get older (although it doesn’t make admitting that your parents were right any easier!). Saving 50p by buying supermarket brand chocolate instead of the big names might not sound like much difference, but if you buy one chocolate bar per week you’ve saved £26. Even though that doesn’t sound like much on it’s own, when you apply that logic to saving even 30 pence per item it very quickly adds up.
Don’t be Too Hard on Yourself
It’s true to a certain extent that you need to be strict with yourself when it comes to saving money and sticking to a budget, but there’s a difference between being strict and being hard on yourself. Sometimes there might be something that you genuinely need that’s going to tip you over your monthly budget, or an unexpected bill might come in and the only way you can pay is by taking money from your savings. It can happen to anyone, no matter how careful you are, and by beating yourself up about it saving money is going to feel more like a chore or punishment than a goal and something to aspire to, so it will put you off. I’m not saying go and treat yourself every time you have a bad day, but try to be understanding if something unexpected comes along that knocks you off target. Having a bad day or week is just that - a bad day or week. It shouldn’t come at the cost of having a bad year financially.
Hopefully these tips help you feel a little more motivated to save up towards your holiday, your dream car or even buying a house! Trying to save money can feel like a huge chore, but when you keep in mind what it is you’re saving for and you actively look for ways to save money it becomes a lot more doable. Keep going, don’t give up and soon enough you’ll realise how worth it cutting out your daily coffee was!
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