Growing up, and even as an adult sef, my mum will always tell me “hope you are saving oh” “make sure you save oh, you don’t have to always buy”. Honestly I found it annoying as a teenager, but of course now that i’m working and earning my own money, I see reasons with her. Spending my own money these days literally gives me chest pain *sigh* so I have come up with a few money saving techniques that have worked for me so far and I have also collated a few other techniques from friends.
Before I begin let me just sound it clearly; no matter how many foolproof saving techniques you try out, they will NEVER work if you do not have the discipline to stay consistent. So now that that’s out of the way, let’s get down to the business of why you are reading this post in the first place.
Divide and set aside
If you are an employee, when your monthly salary comes, divide it into 3 parts and put one part in a separate bank account from the one you spend from. If you are an entrepreneur, get a fraction of your earnings and set aside in a savings account. If you don’t have a “spare” bank account, you can open one just for this purpose. Please take note that having an ATM card to this account is not advisable, so you can do either of the following; destroy the ATM card or give someone the ATM card to keep for you. Of course there are other means of withdrawing money from the bank, but once you think about the stress of heading to the bank, you should (ideally) be discouraged.
Good ol’ Piggy bank
This is a sure banker when it comes to saving your money. This option is not necessarily for saving large chunks of money, but if you wish, you can go ahead and put in one thousand naira notes. If you have spare change lying around every now and then, why not slip it into a piggy bank. N200 everyday or every other day will certainly amount to something that will be large enough to bail you out on a rainy day. You can check out My Kolo for some really cool and modern piggy bank boxes.
Use a Budget
Another sure way of keeping your spending in check is to stick to a monthly budget. Most people prefer to calculate their monthly spend mentally but are unable to stick to it because they lose track of income and expenses. This method is very useful for salary earners. It is pretty simple to perform and a spreadsheet is a very useful tool for this.
Here are a few simple steps to follow when setting your budget:
- First off, put down your monthly income (Using the addition “+” sign).
- Outline all the ‘necessary‘ monthly expenditure for the month beneath the fixed income figure (using the subtraction “-” sign).
- Subtract the monthly expenditure from the fixed income
- Any balance you get can either be invested or put in a savings account.
- You can keep 5% of your monthly fixed income for unbudgeted expenses for some comfort.
This saving method not only helps you save better but also allows you keep track of all your monthly expenses and makes sure you are not going overboard in any particular month. It is quite effective and is a good way of saving the most of your salary considering if you combine it with the first option mentioned above.
Cliche but very effective. There are different forms of investments but the one I speak of here is the one handled by investments banks/bodies. Ideally, investments are made because of the interest gotten from it, but sometimes these interests might be too little to make a significant difference in your account balance, but it still doesn’t matter, it’s better for your money to be “working for you” no matter how small the returns are than for it to be sitting dormant in your account. So yea, find an investment plan that is comfortable for you (there are quite a number; mutual funds, treasury bills and some more I can’t remember now) Put your money in an investment account and keep adding to it every month, no matter how small.
Let’s say you invest 100k in treasury bills at a 16% interest rate (on the average) you will have a total of 210k in 5 years. Do the maths, this means if you somehow manage to save up to 1 million naira and invest it in treasury bills, you will have 2.1million in 5 years. Imagine how much this money will help when you are in need of some urgent cash.
I stumbled on a video from Sisi Yemmie where she outlined very realistic and practical ways for saving money, you should definitely check it out.
Now it’s your turn to talk to me ? Have you tried any of the above methods? Which has worked for you? Do you have any money saving methods I haven’t mentioned? Let me know in the comment section, i’m waiting to hear from you.
Save wisely, you’re not getting any younger ?