Money Saving Tips

Budgeting and Money Saving Tips

We are always on the lookout of ways to save money. The smile and sense of accomplishment we get when we save money is priceless.

Many of us start to aim higher when we have some savings in our banks. New home, car, home appliances are planned only when we have savings in our accounts.

SO, how to save money….

There is a famous story – a great businessman lost everything he had when he made losses. He went bankrupt and didn’t even have money for his next meal. Tired and exhausted, he was sitting in a park. A man came and sat next to him in the bench. He looked at the businessman and asked, “What is troubling you my son?”  Businessman narrated his entire story to the old man. In the end, the old man smiled and wrote a cheque worth $50,000 and gave it to the businessman.

With rejuvenated energy and feeling of financial security, he took strategic decisions which made his business grew multifold. The businessman wanted to return the money to the old man, so he visited the park where he first found the old man. The septuagenarian was at the same place as before. When the businessman was about to return the cheque to the old man, staff from a mental asylum showed up and zapped the old man. They were taking him to the asylum. The businessman learned the old man was a mad who absconded from the asylum, and the cheque he wrote was phony.

The moral of the story is savings can usher in a sense of financial security, thereby helping one progress in life. There are many ways to save money, a few has been stated in the blog.

Tip #1: Create a Savings Account.

This is a tip which I personally followed. When I had to save money for my marriage, I created a savings account apart from my checking account. Internet banking offered me the option of automatic money transfer from my checking account to the savings account. I set the savings amount to be transferred and the date of transfer. On the preset date, the money automatically got transferred. This is how I saved without much hassle.

This savings gave me strength and intent to plan beautiful things for my wife such as honeymoon, new home and other amenities required after marriage. I personally suggest this as one of the best measures in saving money without budgeting.

Tip #2: 50/20/30 Saving Plan

Every person will have 3 kinds of expenses, the first one is his monthly bills such as water, electricity etc. Number two being is his savings such as fixed deposits, recurring deposits and number three is his lifestyle expenses like clothing, entertainment.

Understanding these three types of expenses is essential to have a healthy financial life. Each is distinct and essential in its own way. Senator Elizabeth Warren, along with her daughter Amelia Warren-Tyagi, introduced the 50/20/30 budgeting rule in the book “All Your Worth”.

In the book, they stated that 50% of your income will be spent on the essentials such as rent, electricity and other monthly bills. 20% should be spent on savings such retirement savings, down payment for your home. The remaining 30% can be spent on lifestyle expenses. When the lifestyle expenses are properly planned, there can be further savings.

This tip is continuation of the previous tip. Once you have mapped out your expenses, you can have target accounts for each expense, a savings account to maintain your savings, a checking account for your lifestyle expenses. Prefer using debit cards and don’t use your credit cards for any of your lifestyle expenses. This will help you to keep a tab on the money flow and will help in identify areas where you can avoid the expenses.

Tip # 3 Use Technology

In this technology savvy world, everything is available in our smart devices. Savings plan can be made using our smart phones. Gone are the days, when we used to maintain an excel spreadsheet to monitor our expenses. Now our jobs are made easy by various savings app. There are numerous free and paid budgeting and savings apps.

Digit is such an app that automates your savings. It is connected to your bank account and often analyses your spending pattern. Then it takes small amounts of unspent money every week and transfers it to your savings account. You are informed about the saved amount via text message. All the transactions are done through text messaging, for example, when a transaction is to be made, an SMS sent to digit eases the process. This app saves a lot of money and time.

Qapital is another app that helps you save money by using rules or more specifically “If then” formula. When one of the rules or goals you’ve set is triggered, the money is saved. There are penalties for not completing the target and the money can be taken away from your set expenses. It instils fresh energy and fun on saving money.

Summing Up

Saving money can be easy when we choose the right ways. Investments are also one of the options you can look for to grow your money. Savings will help in having a secure future while you enjoy your present. We have spoken at length about the various ways of saving money.

Money Saving Tips

How to Save Money on Your Home Improvement

Owning a home and maintaining one call for spending a chunk of the amount from your salary and you might the pinch when you have to spend it on maintenance. One might even take up homeownership assistance program to efficiently spend money on home improvements.

If you are looking to make improvements to your home there are ways you can get cost effective home improvement services where you have to spend little and contribute your skills as well.

Save Money on Your Home Improvement

What can you do Indoors?

From saving electricity to fixing appliances yourself there are ways to reduce the expenditure of money or fix things in a cost effective manner. So here are the improvements you can make to your homes with the following ideas.

Bring in a homeownership advisor

Getting your home checked by experts is one way of improving things at home. An advisor will inspect your home give necessary suggestion on what you have to fix, change or buy. In a house, there is something or the other that would need fixing so pay attention to it and maybe do it yourself if it is an easy task.

Using alternative appliances –

The use of appliances is a lot in any person’s home and if you can substitute an appliance with the one which doesn’t cost you a huge bill does it. Take air conditioners, for example, it requires constant cleaning and changing of filters if you are in a place where the heat is bearable use a ceiling fan which costs way less and you don’t have to do heavy maintenance.

Put in cost saving fixtures –

In these global warming times where we see droughts everyone is thinking and making an effort to save and use much less water as possible. So upgrade your home with these low fixtures like in bathrooms such as toilet flushes, which consume less water and does the job and also smart shower heads which detect when you do not need much water.

Replace machinery –

If you are living in your homes from a long time and have very old machinery switch it to the news ones. The new machinery these days has technology that saves energy and electricity. These makeup for a cost effective way of doing things which will benefit you and you do not have to spend as much.

Fix broken doors and windows –

When you see a broken window or door and a leaking tap fix it. These easy fixes can be made with the help of objects that are very cheap instead of replacing the whole door, window or tap. This can be done even if you have very little knowledge thanks to the internet.

Create space –

If you want space to make space, do it by moving things around and removing things you don’t require. Instead of expanding your home by breaking the walls rearrange furniture and bring in new furniture to put things that are lying here and there. It will not only create space but also add a new look to your home and will look organized with additional furniture.

Cover up damaged walls –

Houses often are not built with all the correct material or high standard materials and causes leakage or cracks. Cover these up with wall hangings or an artifact these not only cover up the mess but add to the décor of your home with a simple touch of art.

What can you do outdoors? 

Now that you know what improvements can be done indoors let us explore what outdoor changes can bring in improvements.

Drying clothes on a rack outside –

Forget to buy a laundry machine which dries your clothes not only does it consume so much electricity it also is an added expense. Instead of such machines put up a drying rack out in your backyard, it dries your clothes natural in the heat and you will be able to use them the next day. This improvement won’t take much just a string and pegs to hang your clothes.

Put up rainwater harvesting system –

Water is becoming dearer each and every day and if you are in a place where you receive rainfall every year make sure you have rainwater harvesting system in place. Putting this system in place you can use the rainwater for watering your plants, washing vessels and even having a bath. It cuts down your water usage and also makes your contribution to the environment.

Plant a plant –

Planting a tree outside your home can bring your house the shade it needs. The sun’s rays and the water’s harsh substances can damage your house walls prevent this from happening by planting a tree and its shade will shelter your home.

Few Tips More Tips

Every improvement big or small can be done by you, by contributing your skills and here are some things you can do.

  • Install a mesh in the shower and laundry drain to catch your hair and prevent from blocking the drain.
  • Turn off the switch plugs if they are not in use.
  • Change to less energy consuming lights like LED.
  • Time your shower so that you don’t take long baths.

Summing it up

There are so many improvements that can be made in one’s home and having home ownership and wealth you wouldn’t know where to start but you must make changes from time to time to make changes and be up to date with these changing times.

Budgeting Habit

Tips to Teach Your Kids Budgeting Habits – Money Lessons

Everyone must know the value of money and parents should inculcate money management for kids as they will learn to value money in their lives. It is important to build the child’s knowledge on how to save money and the importance of money. Teaching budgeting and money management skills to kids from a younger age will help them develop better money management habits in future.

Budgeting Habits

Let us look at some ways by which you as a parent can teach your kids on how to handle money. 

Giving allowance

Children learn about money through various ways when they see parents make a transaction, when they get salary and when they purchase things, but a kid will understand what money truly is when you tell them about it. So the best way to start teaching kids about money and budgeting for kids when you give them their monthly allowance.

Allowance acts as a tool for teaching kids how to save when they want to purchase something with their allowance money. They also learn that if they spend the whole money in advance before the month ends they won’t have any money and will learn to budget. This tool of allowance will come a long way as it shows the consistent flow of money, encourages savings and spending money wisely.

Participation in money matters

As the kid grows older they are building up their knowledge about money and how money should be spent. So they have a working knowledge that money is very important and must be carefully spent. Since they have learned to budget and spend their allowance wisely they are now ready to make small contributions to family finances.  Give your kid a small task to manage some household finance like giving a home worker their salary and tracking their attendance. This exercise builds the child’s confidence in managing money and prepares them for their future when they have to run their own household.

Involving the kids in family money matters will bring them a sense of the financial situations at home and how the expenses are managed and how much is saved. This exposure brings the child to understand money matters more and the value of money.

Making savings account 

When allowance is given and your kid has money left at the end of the month encourage them to save. You can encourage them to save by letting them know after collecting a sufficient amount they can purchase something or that it will be the money for their college education. This encouragement of saving will make the kid want to save and put in some amount of money every month. For saving money there must be some money left this makes the kids spend on a limit so that they can save some money and will cut back on things they don’t need.

After introducing saving you can teach your kids how savings account works and can open a savings account. Letting them know they can put money in the bank and will build interest, would be safe and they can withdraw the money whenever necessary.

Spending it right

It is important for your kids to know what is expensive and what is worth buying and when it is necessary to spend. When you are going grocery shopping take your kids along with you and let them observe. When you are choosing a product with different prices bring to the child’s notice on why you are choosing that particular one over the others, be it the price quality or quantity. It is important for them to know what is suitable to buy.

It is also necessary to make them aware of the coupons available and how to identify which products have offered so that they can make a smart purchase. After they have seen you shopping for grocery encourage them to go and make purchases for home needs and see if they are on the right track if not take them again with you and educate them on smart buying.

Track the expenditure

Giving your kid money just isn’t sufficient you need to guide them every step of the way and when they come to you for help do it. After the month ends, sit down with your kid and track their expenditure and monitor what they have been doing. When you have a look at their expenses make necessary notes on where they have gone wrong like over spending on one item and frequent expenses they don’t need. You as a parent must ask your kids to cut down on the unnecessary and use the money wisely.

Monthly meetings

After all this process it is important to know to keep the finances in check, it is easy to teach someone to budget but it is more important to see if they are sticking to it. So every 2 months make it a habit to sit down and see that there is a fair usage of money and make changes if necessary.

Summing up

It is important to inculcate in your child how to spend money and manage it from a younger age itself so that they can grow to be responsible adults and can manage their own finances later on without much trouble.