Tag: Saving

January Saving Tips

As we hit the halfway point of January, many of our bank balances have been depleted and our lunchpacks for work are made up of leftover cookies as well as some leftover Christmas salad. As for New Years resolutions we have promised ourselves to be more savvy when it comes to finances. I bet many of us have also written down a NY resolution related to saving – “spend less, save more”.

To help you on the way we’ve got a list of most useful money saving tips that will serve you in the long run keeping in mind the objective to spend less and life comfortably. And, overall, spend wisely to avoid financial deprivation both in short and long term.

Leaving shopping mall

Food

“Think before you shop” should be the golden rule from now on. Do a food audit once a month carefully examining what you actually have (also, by looking at all the jars of jam and sauces you’ve saved up). Careful examination will help you to make the list of necessary items which will be helpful once shopping. Also, cutting down takeaway and trying to cook more at home may save you a great amount of money.

Shopping

As crazy as it may sound, doing some shopping in January might be a good idea. A number of stores are offering considerable discounts for the items that you might have dreamt of a long time, and it may be one of the best times to get something you’ve wanted with the great discount offered. Also, basics like soap and cleaners are usually on sale because they’re in holiday packaging. However beware of false savings – stop purchasing the things just for the sake of discount. We only encourage you to get the things you really want and need.

Entertainment

When it comes to entertainment, planning is your best friend. Planning your entertainment, including holidays, may save you a huge chunk of money. Have a look at the deal websites offering entertainment packages and holiday deals – by doing this in advance you can save up a couple of hundred euros. Cinema, theatre and a great number of entertainment centers, such as swimming pools and bowling centers normally have discount offers on specific timing and days – make sure you plan your entertainment to save a penny (or two).

Do you have any ideas on how to save money after the crazy period of spending? Share your thoughts with us – we’d be happy to hear from you!

Feeling Tired? Don’t Keep Your Bank Card Nearby

It is a late evening, you just got back home, boiled water, prepared a cup of tea and turned your PC on. Do you know where your purse is? If you are part of a great majority, having the same purchasing behaviour when it is a late evening of a tiring day, you will probably find it lying right next to you, waiting to be open and used. 

We all have read about magical Wednesdays and Sundays, two days of the week when people become a little more relaxed about their purchases and focus their attention on something they should not. According to numerous research done in US, people tend to spend over 20% more during Wednesdays and Sundays. The situation gets even worse if it’s an evening after a tiring day, i.e. university or/and a job.

A simple way to check your psychological state towards purchases would be going out to a supermarket after you had a tiring day. You need to buy a loaf of bread, milk, eggs and a piece of ham, but you end up buying all this plus triple chocolate muffin box, white chocolate, cookies and 2 liters of ice-cream. The psychology behind such situation is easy to understand: we all want to reward ourselves and we are looking for the treat since we think we deserve it. Psychologists call this as “ego depletion”: an attitudinal behaviour when we become a little careless about our purchases when tired.

Having a tiring day (both physically and mentally) can affect your purchasing behaviour, which turns out to be “less beneficial” (both from a material perspective and a financial perspective) than some other time. The “after-job” time, when you are willing to spend more is sometimes also called a “happy hour” – the time when you want to rewards yourself with something you deserve, either by foods or by goods. You get home, get into your own space, get relaxed and are more willing to write down your Visa numbers while purchasing a new pair of facial cream or a scarf. Such emotional state that makes us more vulnerable in regards to our purchases in economics is called “spending trigger”. The bad news is, that we all from time to time have “spending triggers”, but the good news is, that knowing what the “traps” of such behaviour are, you can find ways to avoid bad purchases and financial regrets.

If You Are Overworked

You like your job. Actually, no, you love your job. But the love is so frustrating, that it takes much more than 37 hours/week of your full attention and the only thing that you are craving for, is rest. You might be thinking that you deserve something more than 40 or 60 hour job and that is why online shopping might seem an appropriate way to end your tiring working day regardless of your purchases. Sure, you might be thinking that you can compensate a lack of free time with something you might be wanting (a new computer or a large flat-screen TV), however, such new purchases will make you happy only for a while. Our needs and wants certainly differ, one could be happy with a new pair of shoes whereas the other would consider purchasing the newest Macbook Pro, but the result still tends to be the same: an (un)wanted and (un)predicted purchase with the (un)wanted and (un)predicted expenditure. Something that you could live without. Something you are not fully sure whether you need or want. Something you are undecided about.

In order to avoid high expenditures and unwanted goods, try to set a barrier which you cannot exceed. Think of something feasible: if you think 200 kr/month is a good amount of “unpredicted expenditures”, try to keep purchases within the decided amount. After all, when you have worked for too long, try weighting an opportunity cost: wouldn’t it be better to get an extra hour of sleep rather than purchasing new set eye shadows which you might not even need?

You Are In Need Of Something

You are 100% you need a special product you have been dreaming about for a long time and you simply decide to check the prices as you get back home tired. Knowing that our self-control highly depend on our levels of tiredness, you might want to postpone your purchases, even though you might be thinking that you want it right here and right now.

In order to help maintain control over your purchases, it may pay to avoid making important financial decisions if you feel tired. For less important decisions (such as small purchases) it could also pay off to wait until the next day. And in order to avoid such unpredictable purchases as chocolate muffins or ice-cream, try making a “needs” and “wishlist” for groceries. Saving 20 kr. each week could add a bit of savings into your “leisure” account and if you do so, you might end up having a pleasant amount of savings by saving just a little each time (read an article “Save money like Chinese do”).

After all, it is said that money can buy you happiness, only if you spend them right.

Save Money Like Chinese Do

Are you one of those people, constantly in lack of money and you do not know how to save? According to BBC Capital, your background could have a lot of influence on that.

It is said that the amount people save usually depends on their location and nationality. For example, residents from US are said to save one of the smallest amounts compared to other countries: they save only 3,2% of their income.

According to collected data, Australians usually save about 11% of their income but Chinese seem to have surprised researchers since they tend to save over 50% of their monthly income.

High Expectations

China’s culture has a lot of written and unwritten rules. One of the unwritten rules is for young and unmarried men to earn and save enough money for the apartment, as men are expected to have their own property by the time of their marriage. The other reason for a relatively extreme saving is Chinese welfare system, as there is no pension funds over there and that is why Chinese tend to save as much as possible for the future.

How Much Is Good Enough?

Specialists recommend to save enough money in case of extreme situation. In such case you have enough money to live for 3-6 months without any expected income. The amount can be calculated easily: you only have to check the amount you spend during a month for all your needs, multiply the amount by 0.9 (since an individual in such situation is expected to spend 10% less) and then multiply it 3-6 times (=months). The amount you get is the amount you need to save for a “rainy day”.

Timing

You might think that such amount, that you have just calculated, is impossible to save. At least not as soon as you probably would like to. Your decisions and abilities in this case, certainly, depend on how much money you earn, how many leases do you have, how do your bank statements look like and whether you are in a debt for someone. Yet it is not too hard: imagine you earn and spend 15,000 kr a month. The amount for the three months with limited needs would be 40,500kr (15,000* 0.9 * 3). Therefore, if you want to save the amount you need within a year, each month you have to save 3,375 kr.

Saving money is not too hard as you might think. Do it automatically. The best would be to have 2 bank accounts, out of which one would be meant for saving purposes. Make an automatic bank transfer to this account from the one you get your salary.

If you feel you cannot save that much money from now, start doing so with the small amounts: take away 100, 200 or 500 kr a month into a savings account. Psychologists claim that once you will notice the raising amount, you will feel the excitement and willingness to save more. If you get promoted and your salary has risen, do the same with the savings transfer: be generous to yourself and save a little more. Remember, that this account is meant for saving purposes when you have an extreme case in your life and do not touch it for entertainment purposes.

Based on article from Ekonomika.lt