Self

Ways to save and spend your money wisely

ways to save and spend your money wisely

We want to talk to you about a few ways to save and spend your money wisely. Many people financial struggles are due to not bringing in enough money but for many others the problem comes from not wisely spending.

We'll take a look at six ways to save and spend your money wisely to earn in order to help you reach your financial goals

Let's track your finances

Before you can start figuring out how to spend your money more wisely. You first need to understand where it is going that's always a mystery. Make a budget and track both your income and your expenses and everybody says to do this but they are not doing this. You got to do it once you know where your money's going. You can start looking for opportunities where it could be better spent so start tracking it where are you spending it.

Think about the long-term benefits and drawbacks of the purchases

You are making far too many purchases are just impulsing decisions to buy something that you don't need to impress somebody who doesn't like you. So while this is all great when it's $1.00 chocolate bar at the grocery store, a little bit larger problem when you're out there to buy cars to impress your neighbors. Before you buy something think about how it will affect you in the future, how long is it really going to last, is it really going to put you in debt that you don't need and is the value that you're going to get out of it over its lifetime, is that really worth the cost. I'm gonna tell you right now your neighbors aren't impressed by your car and if they are boneheads. So these are questions you've got to figure out the answers to and determine if something's really worth buying.

ways to save and spend your money wisely

Only put money on credit cards that you can afford to pay off

Every month credit cards aren't inherently a hindrance to your finances after all they're just a convenient way to be able to pay for things and many cards offer some kind of cash back on purchases which is nice however you should only spend money on your credit card. If you're able to pay it off in full at the end of the month, if you pay off your credit card balance each month, you won't incur any interest charges and it'll essentially be the same as paying cash.

Now one way that people start to do this, It's really effective to just put money in cash in envelopes for the budget items that you're gonna spend money on during the month and when that cash is gone then you're done spending money in that category so for example an envelope could be an envelope for restaurant spending, might have $500 in it and when you've spent $500 in restaurants that month you're done going to restaurants. It might be a little easier to control your money that way than to just try to not do it on a credit card.

Stop trying to impress other people

That's crazy the average person spends far too much money merely maintaining an image by fancy cars, brand name, clothing buy them in just the right store much of what we buy has more to do with just impressing other people than purchasing something. I'm telling you man keeping up with the Joneses is an expensive and oppressive and unnecessary pursuit. You got to buy things you enjoy and don't fall prey to the feeling that you have to spend money in order to impress other people. I was working with a lady who so said she was a single mom two kids and she bought a new car just so she could drive her daughter to school in a car and daughter wasn't embarrassed by.

Figure out what habits are draining your budget

After you start tracking your finances you can begin looking for habits that are draining your budget out these habits can include expensive hobbies eating in restaurants, too much spending, too much money on clothing or a lot of other financial drains that you don't need to incur and once you figure out which habits are eating up a large portion of your income then you can evaluate whether these are really necessary right and that's where again envelopes with cash can really get a grip on where that money is going.

ways to save and spend your money wisely

Learn to value savings over products

Some people are naturally good at saving money and draw enjoyment from growing their wealth for others money something that is spent the moment. It gets in their hands and anything else feels like a wasted opportunity if you're in the second camp I want you to try to adopt a mentality that value savings over products.

Also read: 16 lessons most people learn too late in life

In the end money invested or money saved is almost always going to benefit your life more than the money spent on products. That will wear out or become uninteresting with time. Here's the thing you want to start focusing on what you can make on the money. You're saving or you're never going to save it and that's where learning how to invest starts to become so important.

If you can make 15 or 20 percent a yearly saving, money starts to become pretty interesting. If you're only making 1% why not spend it on a refrigerator because you can't invest it. I going to tell you when you're really good at this you do things like Warren Buffett. Start investing as early as you can get your kids doing it. Early spending your money wisely isn't just about avoiding unnecessary purchases it also requires you to take the money that you save and get it into things that'll help you reach your financial goals and that's what I was just talking about with that. There's no such thing as investing too early, getting started too soon or investing too little, even if you have nothing you can start picking great companies and making a great watchlist. It doesn't matter how young, how old you are, how little money you have to invest, putting money into quality companies that will grow in value as time goes on is always a wise use of your income.

These are some ways to save and spend your money wisely. Check these Top 10 investment options to know where to invest your savings.

Comments (1)

  1. Hi, Vipin Kumar! Thank you so much for this article, it’s really helpful for me.

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