11 WAYS TO CULTIVATING AN ENDURING SAVINGS CULTURE OR HABIT.
11 Ways to Cultivating an Enduring Savings Culture or Habit.
Cultivating the habit of savings is a very important one because it affects every aspects of life. A good saver can save out funds for business, live debt free, and enjoy all the benefits accruing to financial freedom. It is far easier for a good saver to reach his/her life goals that can’t be ordinarily attained one with limited revenue. Cultivating a savings culture is never optional and easy. It is the necessary ‘evil’ you must learn to live with if you plan to succeed in this one life of yours.
Savings entails starving yourself off certain wants and pleasures, and that takes a lot of discipline. Many people want to save, many people wish they could save, but just few save at the end of the day. Actually statistics reveals that less 5% of those who earn a steady amount of money monthly or weekly ever get to save. To legitimately climb the ladder of success in the school of savings you have to pay close attention to the points that will be discussed below in this article.
There are certain ways you can cultivate a savings culture.
- ASSESS YOUR FINANCIAL HEALTH
The first major step to savings is assessing your financial health; this would help you know the direction you’re headed and how to get there. You need to have a clear picture of your income and expenses, you need to know what takes the bulk of your money, and also try to ascertain whether you’re spending more than you earn. When you have this figured out then you can move to the next step.
- HAVE AND USE A BUDGET
Having a budget would help guide you on what you ought to spend your money on and what you shouldn’t. With a budget, you would know your needs and wants and have a clear picture of how to cut down your spending especially on WANTS. A desire to satisfy your every wants would make you unable to save. A budget would help you plan better, save better and cut down unnecessary expenses.
- BE DEBT FREE
Try as much as possible to live a life free of debts. Manage your finances judiciously and avoid having to collect loans; live according to your budget, this would help you in the long run. Now, let me tell you this for free, there is no amount of money you earn that you cannot either save from or live from. It is just about learning to cut your coat according to your size.
- SAVE FOR EMERGENCIES
Emergencies happen all the time; this is something we have no control over, and the best way to handle emergency is to save, so you won’t be left out of the dark. Set about 5-10% of your income monthly to save for emergencies, so you wouldn’t be left in the dark when the situation arises. Your emergency savings should be different from your normal savings.
- KEEP TRACK OF YOUR SPENDING
Your spending habits would determine if you would be a successful saver or not. Keep track of your daily lifestyle and what you spend your money on. After assessing where your money goes, look for ways you can minimize how much you spend.
- HAVE A TARGET OR GOAL
The best way to save is having a target or goal; saving without a target might not keep you motivated, but saving for a target keeps you motivated and focused. Have a realistic goal and save towards it.
- SET A FIXED PERCENTAGE
The best way to save is by setting a fixed percentage to be saved monthly. This way, when your income increases, your savings would increase as well. This is best way to keep a steady assent in your savings culture.
- AVOID FRIENDS THAT WOULD GIVE YOUR SAVINGS A SETBACK
Friends are important, but when you have friends that won’t let you save, it’s best to minimize the way you see them. Friends that prompt you to spend money won’t only kill your savings but might even push you to spend above your earnings. Such friends actually shouldn’t be given any inroad into your financial goals or plan.
- PRETEND YOU’RE PAYING OFF A LOAN
The best way to frame your mind-set towards savings is to pretend you’re paying off a debt. Continue making the monthly payments into your savings account. Even after you reach your set goal, never stop this habit. It will pay off for future goals and plans.
- SET YOUR MIND TOWARDS SAVING
Having your mind geared towards saving would help you save better. Never budget or spend all your income rather always ensure you have a particular amount you will save up every time you get paid. Also, if you notice you still have money left at the end of the month, rather than spend it unwisely, the best bet is to save it. This would help you reach your goal faster.
- HOW TO SAVE WITH LOW INCOME
The reason you are not saving with your current meagre income is because you think it is not possible. You have to first of all believe it is possible. The money to put aside will not magically appear, you have to take it out of your salary or income first, and live with what is remaining. It may not be easy. Look at your savings as your ticket to freedom. Make it your number one financial priority. The moment money comes into your hands, put aside your seed (savings) before you start consuming. Some things will have to give way e.g. spend less on calls, internet, eating out, use public transport or walk more instead of ‘uber’, etc. There are a thousand and one ways to reduce expenditure. You can think of how to make more money with what you already have.
The first thing is to decide how much you will be saving every month, and then work out how to best use what is left. It is all in the mind. The key issue is, do you want to remain perpetually in financial bondage or do you want to be free? Where there is a will, there is a way. It is fruitless trying to argue with someone if he or she cannot save with their current income. It is a waste of time. While you are busy arguing that it cannot be done, someone is already doing it. Other people might say it cannot be done but that shouldn’t hinder you from trying. Some ‘Oga’s at the top’ have received the shock of their lives when they discovered what their driver has more assets than them. It has nothing to do with income, but what you do with it. Can you save on your current income? The correct answer is what you want it to be.
If you decide to save, then you can. Do not despise your days of small beginnings. Be humble and start from where you are. Decide on any amount and start, even if your best is N5000. A lot of people complain that the interest is peanuts. Tolerate the peanuts for now and allow your principal to grow. You will not call it peanuts in two years. There is no excuse not to save. Not having savings is a choice, which comes from the consumerism paradigm of spending first before saving. If you treat savings as a bottom item, nothing will drip into it. When you pay yourself first, you are forced to save and live on what is left. That means you have less money for impulse items and pleasing other people.
I hope you find this article helpful.
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All the best!
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