The world is grappling with a pandemic. There’s still no cure, and its aftermath in the economy has been devastating, to say the least. The only ray of hope is that the economy is slowly recovering after being in shambles for the last few months.
We’ll see how things pan out in the next few months. For now, what you need to remember as a commoner is that more attention should be given to savings in this changed scenario.
Here are a couple of tips to help you move ahead in your savings journey.
Save for the present
Might sound bizarre, but not a novel idea I could promise. Remember the “take care of the pences, and pounds will take care of themselves” slogan? It’s the same thing.
Many people seem to forget that the future doesn’t fall from the sky. It’s the present that morphs into the future. The actions you are taking in the present will decide the course of the future.
If you spend responsibly and diligently, don’t indulge in lavish and extravagant activities, and most importantly, always have an emergency fund ready, you won’t have to worry about the future. This might sound like a cliche advice, but you’d have to agree that it always works and never fails.
Make savings interesting
One reason people are not taken by the idea of saving is that they don’t find it exciting. Even people who save a certain amount every month fail to remain steadfast months or years down the line.
So no more hold the nose and save. Instead, bring a starkly different approach to saving. Make saving a rewarding experience. Tell yourself that if you could save $100 this month, you’d treat yourself with an ice cream parfait. If you could save $300, then a steakhouse dinner and a movie.
And don’t just stop there. Think of other creative ways to save money. Throw a contest with your buddies and acquaintances. Whoever wins the contest will get a treat from other contestants.
Invest in redeemable goods
Buy staff that you can sell at moment’s notice. I know that buying land is considered a smart investment step. But the problem with doing that is that it’s impossible to sell off acres of land on a short notice.
Buying electronic goods, electrical appliances, and home depot staff is essential. Such buys don’t qualify as investment. But buying gold or precious metal is investment, and selling such possessions is easier compared to selling an RV camper or swathes of land.
Investment advice are aplenty. All you need to do is browse the Internet, and hundreds of financial workarounds would be at your disposal in next to no time. But finding the right advice is all that matters. When you invest in something that is sellable, you keep the problem of liquidity at bay.
Checking accounts are better
The reason a checking account is better than a savings account is that it keeps you financially mobilized. The checking account requires you to deposit and withdraw money periodically.
Why do I think it’s better than stashing your money into a savings account? Because doing the latter would put an end to financial mobility. Doing the former would keep you financially active.
Saving habits must be in sync with your overall financial demeanor. If you keep yourself active, you must be active everywhere across your financial life. What better way is out there than keeping a checking account and periodically depositing money into that account? Probably none.
Buy low, sell high
It is said that the essence of business lies in four words, “buy low, sell high.” To build a healthy saving habit, you need to internalize these four words. Whenever you buy something, be it electronics or fancy apparel, bear in mind that you might have to sell it out one day.
Put it simply, whenever you buy something, buy with the mindset of investing. Buy only after you see profit in a trade. Once you adopt this mindset, you start to see every purchase decision from a completely new angle. Firstly, you won’t buy something that you couldn’t sell. Secondly, you’ll buy when the price is low and sell when the price soars.
This way, you won’t have to carve out separate strategies for saving. Spending and saving would be synonymous for you.
Saving isn’t the goal
The real goal is financial independence, and saving is just a step to reach that goal. Those who don’t understand this resort to financial austerity in the name of savings, which is not desirable. There should be a healthy balance between saving and spending. Only then the goal can be reached.
So that’s it. Follow the five tips shared here if you want saving to be easy and seamless. And of course, let us know how these saving tips are changing your life.