Hot ways to improve your personal savings in 2018. Developing a healthy financial structure is as good as practicing a healthy living, that being said, the importance of adopting ways to improve personal savings becomes Paramount on top of priority.
The purpose of this guide is not to promise an overnight millionaire, however following the below steps can actually make a great difference and improve your personal savings and finance.
Savings is a practice of taking away a fraction of your income for future use which could be aimed at unforseen circumstances.
Benefits of savings:
1. It provides a financial backup, life is full of uncertainty, need to save money to safeguard yourself when faced with harsh realities.
2. It can make up for seed money, you can startup a business without seeking out loans, no startup financial stress.
3. Can as well invest the seed money in stocks, bonds etc for a later yield.
4. With good savings plan, one can retire young while he pursue enterprise to better finance.
5. Entrepreneurship, one major problem of entrepreneurial development is the funding. With enough savings you can start a business with resilience, energy and hard work you are good.
You can improve your personal savings in 2018 through the following:
1. Set a SMART goal: The truth is, you can’t get to your destination if you do not know where you are headed for. To live this dream, you need to set goals, what exactly did you want to save your money for? It should be stated if possible on a sheet of paper. Read it to yourself every morning and work towards its actualization.
Besides, your goals for whatever reason must be a SMART one.
S- Specific, you should set specific goals void of ambiguity, should be clear to your interpretation without any form of misconception, this is your motivation.
M- Measurable, your set down goals should be measurable. Don’t set goals without measuring parameters towards achieving such goals. It should fit into plans and well accommodated.
A- Achievable, set goals that are within the tenets of available resources, you should achieve this within a specified time frame.
R- Realistic, you should set realistic goals to help you improve your personal savings. It must not be a wishful thinking.
T- Time, there should be a time frame to measure your goals, which may be short, medium or long term, you should work towards achieving your goals within a specific period of time otherwise the aim of such goals will be defeated.
2. Make plans: Setting goals is like a wishful thinking without making adequate plans to back it up. Strategize plans that will bring your goals to fruition. These plans could be the much strategies you laid down to help improve your personal savings and finance. This could include savings pattern, choice of investments etc.
3. Create a budget: This is your financial plan for a defined period of time. Projects you hope to undertake, what you intend to spend your money on? They should be defined and spelt out in clear terms.
4. Kindly differentiate your needs from wants: Your needs are the basic and essential commodities of life such as food, shelter, clothes etc. Needs from your budget should be given priority, wants can wait, if you must improve your personal savings and finance, prioritize your needs and avoid the wants.
5. Ask for a pay raise: If you are a salary earner, it’s necessary to have a discussion with your employer to improve your service terms and conditions, be bold enough to push for an increase in your salary this will improve your personal savings and finance as well.
According to Heather MCGregor, if you ask for a pay raise, you must believe that you are not being paid the right amount of money.
In practice, you will never get to be paid the right amount of money, because no body can actually pay for your time. A pay raise will improve your personal savings if you push rightly.
6. Save at source: There’s a room to improve your personal savings if you choose to save at source. This is an agreement where you have your salary account being debited to credit a specified savings account automatically while you receive the residual balance. This will help you have a healthy savings, impressive way to save money from salary.
However, avoid requesting for ATM cards for this category aimed savings account, it will only break your savings rules through unwarranted withdrawals.
7. Consider a cheaper housing: This could be a major reason you struggle to maintain a descent personal savings.
Read also: Best banks for small business loan
To improve your personal savings, find out if your rent is sucking or way too much for your income, you could be spending much on housing. Area you domiciled could be a factor as houses are being priced according to choice areas.
If you live and work in choice areas in Portharcourt, Lagos and Abuja, you will appreciate this revelation. Move to a less choice area with affordable rents to accommodate your budget as well improve your personal savings.
8. Pay yourself: That sounds strange but can be effective to improve your personal savings, in your financial struggle it pays to set up a modality to pay yourself from your earnings, it can amount to huge sum at long run.
9. Avoid Borrowing: He who goes borrowing goe sorrowing. Always live within your earning. Avoid habits of borrowing money to buy flashy electronic gadgets, phones, jewelries and expensive clothes to impress anyone it cannot in anywhere improve your personal savings, rather bring you embarrassment when you cannot pay back.
10. Remove your savings first, then spend: The difference between the rich and the poor is that, the rich save from what they have and spend what’s left, while the poor spend what they have and save what’s left if at all. It’s a bad financial ideology to practice. You must remove your savings first no matter the circumstances, this can only be your bailout to improve your personal savings and finance.
11. Scale down your expenses: You may consider eliminating unnecessary expenses from your budget.
E.g Telephone bills, reduce the amount of money you spent on irrelevant calls, use text messages instead where necessary. This will amount to so much by the end of the month if you are able to monitor it.
How often do you steam your generator set, this is specific in Nigeria considering erratic power supply. You can instead buy rechargeable lamps, charge them for use at night than always buy petrol.
The money you spent in fuelling generator every night can pay your annual rent if you have ever cared to consider. Say you buy four liters each night at N600. N600 x 30 days= N18,000 for one month.
N18,000 x 12 = N216,000 for one year. Isn’t that crazy to know how much you probably spent on fuel in a year while you may not have a complete savings of N50,000 for the whole year. Your rent could be N160,000 or N170,000 on average scale, be wise.
12. Keep cash away from home: There’s always a direct correlation to spend when money is readily available, you had better keep the money in your savings account to improve your personal savings.
13. Convert your passion to cash: You can actually improve your personal savings offering some services in exchange for money.
With good writing skills you can make money on Fiverr, do some data entry and freelance jobs part time online and earn decent income, to improve your personal savings.
You may start offering private lessons to students , can make it a mobile and part time job, name your price and parents who can afford it will pay.
Read also: How to save money for your child’s future
Are there questions or contributions you wish make, field them in the comment box below.
Raphael is a seasoned and dynamic writer, with interest in Banking, personal finance, entrepreneurial development. A councillor and motivational speaker.