Everyone has aspirations in their life, everyone wants a nice house, a better car or to go to their favourite restaurant. While this is not a bad thing, the problem is that most people take this money away from potential wealth building activities. When people look for money to save, they often say that their expenses are just too high to cut down or that they have too much debt to repay.
Always remember that there is some way to cut down and it’s often within the luxury spending area of your budget. Instead of going out 3 times a week you could cut that down to 1 and save some money. A small amount will go a long way when it comes to saving and putting away money for a rainy day.
Pay Yourself First
What wealthy people are doing is paying themselves FIRST. In other words, they always make sure the money that goes towards their savings and investments goes off first thing every month and then use what’s left to pay their usual monthly expenses. If you practice this it will help you keep your expenses low or live within your means and ensure your savings are high and accounted for, which is crucially important in today’s unstable economy. Always make sure that your aspirations never over take your savings and building your wealth, because while there are good things to have in life, your savings and investments need to come first.
What most people have a problem with is at the end of every month they think they will use the money that’s left over after the month’s expenses to put into savings, but by then the money is already gone. You need to put money into your savings the day you get paid, by doing this; you limit the amount you will spend on your social life and learn to save towards those financial aspirations, if you sleep on it you will probably realise that they aren’t entirely necessary in your life… right now.
By saving money in the beginning of the month, not only do you guarantee a better financial future for yourself but you also learn to control your spending habits and you can figure out what your important expenses are each month as well as those you could do without. This also goes perfectly with planning your budget and following through with it effectively every week.
Written for www.truthaboutmoney.co.za a 1Life initiative.