Steps to Develop a Healthy Saving Habit
When you first start earning money, you might not have thought much about saving (and even if you did, there wouldn’t be much left from your meagre salary), but when you start getting hikes and when you see your friends investing big, you might have tried to start saving some money of your own.
This is not an easy task for many of us due to various reasons. Here are some steps that you should take immediately to develop a healthy habit of saving.
Step 1: Make a realistic saving goal:
Do not jump into the deep end and make an unachievable goal, especially if you have not been trying and failing at saving for years. If you make a goal that you cannot achieve, you will unnecessarily put yourself out there to be demotivated. Start small. For best results make a goal for six months or a year. Decide upon an amount that is realistic in this period so the fact that you can achieve it if you try will keep you motivated.
Step 2: Break the goal into smaller targets:
Once you have thought about what a realistic amount and period is for you, the next step is to break this goal into smaller targets. For instance, if your goal is to save Rs. 12,000 in six months, break this into smaller period of time and amounts. Thus, instead of thinking of saving Rs 2,000 per month for six months, think about saving Rs. 500 per week. Smaller targets are more easily achievable and thus will keep you motivated. This is to create the habit of saving. Once you become accustomed to the habit, you can aim higher and increase the goal.
Step 3: Reward yourself:
Treat yourself when you achieve a target, be it a daily/weekly/monthly target. The reward-punishment psychology will ensure that your behavior of saving is reinforced with the reward. Soon you will be on the way to being intrinsically motivated to save.
Step 4: Open a separate bank account with no ATM, Debit card or Online Banking facility:
This may sound a little farfetched, but think about it, what better way to make sure that you are saving money unceasingly? The new bank savings account will give you a clear picture of how much you are saving. There will be no confusion as to how much you saved each month, and if you are able to keep up with your targets.
Further, the lack of ATM card, debit card and online banking facility will make it that much more difficult for you to spend from that account. So chances are that you will leave it untouched unless you need the money for an important cause.
Step 5: Keep a daily motivator
You have to keep yourself motivated when it comes to saving. You can do this by placing a motivating statement or two in places that you will see every day, many times a day, such as the mirror or in your wallet. This will give you the daily motivation that you need.
Step 6: Benefits of saving
Start a journal. Spend a few minutes daily jotting down all of the benefits that you will receive once you have achieved your goal. Make sure that you also write down how it makes you feel to be able to save and reach your daily/weekly targets. Writing down the benefits will motivate your sub conscious mind and in return help you stick to the routine of saving.
Step 7: Ask a buddy/ family member to help you stay on track
Having someone to keep you motivated when you are not feeling very motivated is a sure way to make you stick to the routine. Pick someone that you are close to, authoritative (if need be) and are sure to help in keeping you motivated. Don’t pick someone who is not close to you because they may not be as comfortable telling you the truth or pushing you when you need it the most.
Sticking to these steps will ensure that you are well on your way of saving that money like you have always wanted to. It may be difficult in the beginning, but you will soon get used to saving and it will become a habit and a natural way of living.
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FAQs on Steps to Develop a Healthy Saving Habit
- What are the 5 common ways to save money for the future?
You can save money for the future by managing your expenses. You can do this by tracking your expenses and planning a budget. You can track your expenses by recording how you spend your money. You can do this by using various apps if you don’t want to do it manually. You must prepare a budget and spend money according to that. You should set aside at least 20% of your income for savings. Another 50% (at most) should go towards necessities, and 30% should be spent on optional items. The 50/30/20 rule of thumb can help you quickly and easily create a budget for your finances. Having strong financial discipline will help you save money. Another common way to save is to open a recurring deposit. This way you will be able to save money for the future. Every month set aside a certain sum (depending on your financial goals). You can also invest money in various government and retirement schemes which also give you tax benefits. You can buy gold and mutual funds. Make sure you have an emergency fund. It is recommended to have multiple sources of income so you can save more. Another important step is to pay off high-priority debts (high interest) and credit card payments on time to avoid penalties.
- What are the important steps to develop a Healthy Saving Habit?
The most important step to developing a healthy saving habit is to consistently track your expenses and always stick to your budget. Like developing any habit, the key is to be consistent. Once you train yourself to not waste money on unnecessary things or to spend money wisely, you will curb your expenses. Setting aside an amount every month either as savings or investments can help you save up money for the future. You have to set realistic financial goals and follow them meticulously. Train yourself to reward yourself when you stick to your plan. Make sure you are flexible and leave room for changes and contingencies. You can develop a healthy saving habit by putting spending limits on your transactions. Have an accountability partner if you tend to go overboard with your spending. There will be times when you may not be able to stick to the budget. Do not be hard on yourself. It is normal to indulge at times, the important thing is to get back on track.
- What is the best way to save money as a teenager?
A typical teenager has limited resources. The best way to save money is always to spend less than your income. You can set up a minor savings bank account or joint account with your parents so you can set aside your savings. The first step is to calculate your sources of income and expenditure every month. Set realistic goals on how much you want to save and follow the plan. This will help you save money. Make sure you track your expenses meticulously and set aside a dedicated sum every day/month depending on your financial goal. Avoid using credit cards as you may end up paying interest or penalties if you don’t pay your bills on time. You can cut down on your expenses by investing in high-quality items instead of trendy or fashionable choices. Thrifting or buying secondhand items is a great way to save money and the environment. You can take up part-time jobs to make more money so you can save more money. You can use coupons and student discounts to save money as well. Have a clear idea of why you want to save money. For example, if your goal is to travel, then motivate yourself to save money by having a mood or vision board to remind yourself of the reason you want to save money.
- What are the common saving tips that can help me save money?
You can unsubscribe from any entertainment plans that you do not use regularly. Share the plan with your family or friends. You can use offers and cashback to save money on transactions. A popular trick is to have a wishlist and curb impulsive spending by leaving items in the cart for 24 hours before you make a purchase. You can go to a thrift shop to save money. Volunteering at festivals and concerts can help you save money. You can get a job (even part-time) at your favourite store /shop as that can help you get an employee discount. You can subscribe to free memberships of different brands to get early bird offers and discounts. You can shop during sales to save money. If you spend a lot on takeouts, try to plan a few home-cooked meals to save money. You can use public transport or carpool to save money on travel. You can start DIY projects or ask friends and family to help. This can cut down on a lot of expenses.
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