Here are some tips to help you get started in practicing the everyday saving habits
“6 jars” system
Automatically divide your monthly account into different funds is a smart way to save. The “6 jars” system developed by T. Harv Eker advises to divide your money into 6 jars or 6 bank accounts, also known as 6 financial funds.
The ratio of these 6 funds is detailed as follows:
55% of income is for daily necessities: food, drink, utility bill...
10% for long-term savings: used for emergencies or long-term goals such as buying a house, buying a car, sending your children to college, retirement...
10% for education: attending classes, seminars, buying books...
10% for entertainment: take care of yourself with high-end products and services such as an expensive handbag, or an European trip...
10% for financial freedom: used for investment and business to generate passive income
5% for charity
Whenever you get income from salary, bonus or whatever source, divide your money into these 6 funds. This is considered the easiest, most effective and simplest money management principle in the world.
Use money management apps
If you are worried about your monthly spending, try installing a money management app to note your daily expenses, receive alerts for overspending, or even transferring money to a savings account based on your daily account balance.
If both you and your partner are trying to stay within the family budget, then this app will be useful for your expenses management.
Clear your debts
It can be a problem if your monthly debts are due, and any delay in debt repayment can affect your credit score. Thus, you need to have an active repayment plan. Consider one of two solutions: Prioritize repayment of small loans or credit cards to help reduce the burdens, or repayment of debts with higher interest rates first.
If there is no available source of income to pay off your debt, consider applying for a low-interest loan at bank to pay off higher interest rate loans or credit cards. This will help you simplify your payment and save from the interest rate difference.
Take advantage of discounts
Consider choosing 1 provider for each product/service group you need to enjoy a higher discount rate. For example, buying home and car insurance from one company will save you more given their discount policy applied to customers who buy more than one product. Or if you are using telephone, cable TV, and internet services from different providers, you will have to pay more than using service packages of the same provider. So, please call to each provider to make a research on total cost in case of using their service packages, based on which to make your best choice.
Learn to say “No”
If you are having trouble saving money, you must learn to say “no” to unnecessary, out-of-budget expenses such as spending on premium coffee, eating at luxurious restaurants, or staying at expensive resorts, etc. Please carefully consider before deciding to go on travel with your friends.