You are currently viewing our desktop site, do you want to visit our Mobile web app instead?
 Registered users can save articles to their personal articles list. Login here or sign up here

How to become a saving specialist

Making saving a habit and not a chore.

Some practical tips for improving your saving skills and making saving a habit, not a chore:

  • Don’t set yourself up for failure: If you don’t have a natural inclination towards saving, start out small and set mini-goals that are both realistic and achievable. Rather than thinking ten years ahead or trying to save for something big, set smaller, shorter-term goals that you know you can achieve. With each success, set larger goals to work towards – and reward yourself, preferably with experiences, when you achieve them.
  • Put yourself on autopay: You don’t spend what you can’t see, so automate those savings account debit orders. This will make saving a priority in your life and force you to live off the balance. Don’t forget to attach annual inflationary increases to your savings premiums.
  • Adopt a savings mindset: To be a successful saver you need to start thinking like a saver, not a spender. Where a spender will ask ‘Can I afford it?’, a saver will ask, “Do I need it?’. Track your savings and learn to derive more pleasure from watching it grow than you do from spending it.
  • Become the CEO of You Inc: If you were a business entity, you would want to be financially viable and make a profit each month. So, make You Inc a successful business and start working towards making a profit. Regard everything you manage to save at the end of each month as ‘profit’ for You Inc and see how successful you can be.
  • Keep your eyes on the road: Write down the goals that you want to save towards and keep your eyes focused on these goals. If necessary, create visual reminders of your goals to keep them top-of-mind.
  • Name your accounts: Use your online banking platform to manage your bank and savings accounts. Set up separate accounts for each of your goals and then name them. Every time you logon you will be reminded of the goals you are working towards and can visually see your money grow.
  • Have a savings jar: A great visual reinforcement of your commitment to saving and how money can accumulate is to have a savings jar in which you can put your spare change and coins.
  • Set guidelines: Determine how you intend employing your after-tax income. A great guideline is to put 15% aside for retirement funding and to use 60% to cover your living expenses such as home, food, utilities and other necessities. The remaining 25% can be channelled towards discretionary saving (such as TFSAs and emergency funding) and discretionary spending.
  • Give yourself an allowance: Unless you’re on a hunger strike, all starvation diets eventually fail. Be realistic about how much you can spend on hobbies, sports and entertainment, and then set that money aside so that you can use it guilt-free.
  • Focus on being wealthy, not looking wealthy: Competing with the Joneses is a race you can never win. If you enter the race, others will expect you to compete and will measure you on the material wealth you flaunt. If you choose not to compete, you can channel your money towards building real wealth.
  • Make good financial decisions: Practice making good financial decisions, even the small ones. If your cellphone is due for an upgrade but is in perfect working condition, then don’t upgrade. Drive your car for longer, cancel your gym membership if you’re not using it and take care of your stuff so that it lasts longer.

ADVISOR PROFILE

Gareth Collier

Crue Invest (Pty) Ltd

COMMENTS   0

Comments on this article are closed.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
Insider PRO
R1750pm

For financial professionals. Moneyweb's Insider Pro subscription will allow you to promote your financial services to the Moneyweb community.

This subscription includes a
Click an Advisor profile on Moneyweb.co.za.

Latest Podcasts

NEWSLETTERS WEB APP SHOP PORTFOLIO TOOL TRENDING CPD HUB

Follow us:

Search Articles:Advanced Search
Click a Company: