Money saving rules applicable at any age

A good new year’s resolution would be to regulate impulse buying or shopping as it will save you money in the long run.

The new year comes with new goals and aspirations and one of the popular new year resolutions is to save money. Most people want this, are good with this but many are also clueless. In many cases people do so well in the first two months of the year in keeping tabs with budgeting and saving money but depending on circumstances, somehow gets lost along the way.

Here are some straight forward money saving tips that can be your guide to maximize the income that goes in your pocket and making it work for you in the long run.

‘The 50/20/30 Rule’

This rule basically makes you apportion your income after taxes into three divisions:

– 50 percent goes to your basic needs such as utilities; food or groceries; house, life, and health insurance; and car payment.

– 30 percent goes to “wants” or little luxuries in life such as shopping, dining out, extra-curricular activities, and travel.

– And finally, the remaining 20 percent goes to savings—no more or less.

The advantage of this rule is it makes you have that conscious effort to apportion your salary in three important aspects of your life. It allows you to meet your responsibilities with debts, still have the means to enjoy life and plan for the future.

‘The 70 percent Rule’

This rule apportions 70 percent of your salary for anything that you spend on a monthly basis whether they are utilities, clothes, food, fun expenditures, hobbies etc. Twenty percent goes into savings and 10 percent goes to investments, retirement, health insurance.
The wisdom behind this rule is that it gives you room to budget wisely as expenses are always expected to grow and at the end of the day, you still have money left to save for the future.

In the event you spend less than 70 percent, better for you as you will have more money to save or invest. If you follow this rule, just keep in mind that 70 percent is your only spending threshold.

‘The 30- Day Rule’

This rule especially helps the impulse buyers or shoppers. This curbs your hunger to get into impulse spending. This also helps you to only purchase the things that you need for everyday living and in the long run makes you save more money.

It works by negotiating with yourself really. Whenever you are in a shop or mall and you feel the urge to spend whether for new shoes, dress, or a toy, have the power to stop yourself and leave the store.

When you get home, write down the piece that you wanted to buy, where you found it, the price and the date. Post this in a place that is visible to you and think for 30 days if you really “need” this item.

If at the end of the month, if the need to buy that item is still there, buy it. But if the need to get it is no longer there—good. You saved yourself from a bad purchase and made your bank account retain a few dollars.

‘Get Everybody Involved Rule’

When you are truly bent on managing your finances to save for the future, get everyone in your life involved—friends and family. They are good encouragers for you to stay on the right path, give you advice and guidance along the way. Battling with how you spend your own money is tough but with accountability from others, it helps you take charge of your finances and eventually your future.