For the majority, money is an essential resource that you need to work hard for. With that in mind, you surely would not want to waste the fruits of your labor with careless spending. Proper cash management is essential to securing your future. Aside from the material benefits that money can provide, researchers from Texas Tech University proved in a study that increasing savings or assets significantly contributes to one’s life satisfaction or happiness. In spite of this, saving money is easier said than done. The temptation to splurge and spend follows you wherever you go. With the money-saving strategies presented below, you can watch your finances grow in no time.
Prioritize savings.
If you wait until you are done paying bills and buying necessities before setting aside money to save, you may end up with zero left over to store. You can avoid this mistake by using the “pay yourself first” tactic. Prioritize growing your savings by deducting the money for saving right after receiving your salary. This is easier to do today as banks and companies often team up to offer an automatic savings option. An experimental study revealed automatic payroll deductions is a highly effective way to increase savings may convince you to try this method.
Hide your credit cards.
Credit cards can provide a convenient way to shop, but cashless transactions make it easier for you to overspend. To spare yourself the trouble of high credit card bills and charges, get into the habit of paying in cash. Cash may be your last option when your credit card is available, so you may want to leave your plastic at home. If you are not carrying your cards around, you can think twice before purchasing an item or only use it during times when it is really necessary. This claim is proven by Dun & Bradstreet, a consulting company with a study showing that people tend to spend up to 18% more when using credit cards. Just think of how much you can save by paying with physical vs. plastic money.
Procrastinate on spending.
Procrastination is a bad habit that kills productivity. Surprisingly, the practice of choosing to do things later can be a great tactic to help you save for the rainy days. You can do this by opting not to immediately buy items that you want. Instead, give yourself a day or two to think about whether you really want to purchase that item. Chances are, your desire to purchase something might have dwindle. If you are lucky, those items might already be on sale when you do come back to finally buy it. This strategy is proven to work, according to a research from Paris Dauphine University, saying that by delaying purchases you can kick the habit of impulse purchases and save your precious dollars.
Visualize the future.
If you really want something and you have the cash for it, stopping yourself from buying it can be extremely difficult. To avoid overspending on unnecessary items, try imagining the negative consequences of giving in to your wants. Think about the rewards that you will reap by sticking to your resolve to save money. If you spend without regard about its effects on your future financial status, saving money is much harder. This theory is proven by a study from the Journal of Consumer Research. In order to grow your savings with ease, it will help to visualize the positive and negative effects of your spending habits.
Money management takes hard work and discipline. It may be hard to save up cash to ensure a comfortable future but it will surely be worth it. If you do not want money to be a major concern someday, you have to exert real effort to build up your savings. If you save religiously and invest wisely, you can soon enjoy financial freedom.
