Start NOW | A Practical Savings Plan For You

By Nishant | November 18, 2020

Don’t wait until the end of the year to start a new financial resolution. The actual execution of a savings plan is tricky. We’re going to talk about tried and tested ways to save that have worked for people. Read on!

A Practical Savings Plan For YouYou never know what the future holds. Life’s inherent unpredictability makes it exciting but that whole ‘living in the moment’ and ‘taking one day at a time’ thing doesn’t quite work. If you’re doing well in life, good for you. But don’t blow it all away by being stupid. Think about life after retirement and how you can totally rock that too. Start saving NOW!

So what are the best ways to create a savings plan you can stick to? Well, you’ve certainly hit the jackpot today. Read on and reap the benefits. You can thank us later.

Additional Reading: Save Money, Clear Debts, Enjoy Life – Is It Possible To Do All 3 Simultaneously?

The Essential BIG Save!

Let’s start off with a bang, shall we? We’re mentioning this right at the start since there are no two ways about this one. This is something you HAVE to do. What are we talking about? Life, post retirement.

This should be comfortable but is just ‘comfort’ enough? Those are the years where your health gives in and you could have problems that you can’t imagine right now. The golden rule is that you need to save 10% of your gross income to live comfortably in your retirement years.

While this is a good starting point, it’s best to figure out what kind of lifestyle you really need during your retirement years and to personalise your savings plan accordingly. The 10% rule is only applicable if you’ve started putting aside funds from your first paycheque.

This needs to go up to 20%, 30% or even 40% depending on how late you start saving. This number is totally up to you. If you want to live the good life for as long as possible, a little sacrifice now is a must. Sort out the future first. The present will take care of itself.

Additional Reading: Simple Ways To Save Money

Set A Goal (Small At First)

Identify what you’re saving for and start immediately. Start saving for small goals first and achieve them. That feeling when you get there is awesome. That sense of accomplishment is infectious and gives you motivation to move on to something bigger.

A nice pair of headphones at first, perhaps? Maybe then move on to something a little bigger like a giant TV? Probably a fancy holiday after that? You get what we’re trying to say, right? There is such a thing as a ‘saving’ curve’. That journey from a novice to an expert should be gradual. Also, having a very specific goal will help you stay motivated and on track.

Easy access to credit hasn’t helped things along and we recommend that you learn to enjoy your own money. Saving also takes the stress out of wondering if you have enough money or not. Credit Cards are awesome if you know what you’re doing. But that’s a topic for another time.

Open A Dedicated Savings Account

It helps a great deal to have a dedicated Savings Account for these goals so that things don’t get muddled up. We have so many expenses in our lives and it’s good to have separate accounts to cater to different needs.

Your Savings Account should only grow, as a self-imposed rule. It’s a tried and tested method and, not surprisingly, works wonders for your savings. Let’s just say that different accounts let you see very clearly where you stand financially. Savings account = cactus plant. DO NOT TOUCH!

Additional Reading: Different Kinds Of Savers

Track!

You can’t escape the calculation bit and tracking your expenses to determine how much you’re truly able to save. Calculate your monthly basic expenses and see if there are ways to trim down the bills. Then, subtract your fixed expenses from your monthly net income and take a look at what’s left over.

We’re looking for expenses that can be avoided with a bit of self-control. You might want to stop eating out every now and then for example. Yes, we all love eating out but it doesn’t have to be done regularly. Instead, learn to cook at home. Not only is it a healthier option, it will help you save money as well.

How About Some Fun?

The fun doesn’t have to stop, really. We said that it was a practical approach to saving. We do not expect you to renounce all worldly pleasures. Not at all! A major lifestyle change will make you think about all that you’ve given up and if it’s worth it. You might just miss your old life too much. Then what? Relapse! We really wouldn’t want that now, would we?

Additional Reading: 3 Sure-Fire Ways To Save Money In 2019

Automate It

Once you’ve done this initial planning, the best way to stick to your savings plan is to automate the transfer of funds to your various Savings Accounts. You can do that by setting up automated payments to your bank accounts on the first of every month. Just accept it as something that has to happen. Never stop these payments. Auto debit is magic. Enjoy the benefits.

You Shan’t Be Tempted

While automating your plan takes much of the work out of saving, the best way to resist temptation is to avoid it altogether. Don’t walk around malls. Go for a walk in the park instead. Stop window shopping. When you need to absolutely buy something, go and buy. It’s that simple. Sometimes, all the best ideas are right there in front of us. We just don’t see them.

Additional Reading: Want To Save Efficiently? Trick Yourself Into Doing It

Rise Above All Else

If you’re going out to a restaurant with friends for dinner, you may feel the need to match their orders in terms of expense. Well, that isn’t something you should be doing. Learn to live within your means. That pricey treat could break your budget. Only get what you can afford. As simple as that.

The key to any savings plan is to stick to it, no matter what the circumstances. While you might have a bad month, lose your job or just feel the need to splurge every once in a while, that’s okay. Allow yourself to be human. That’s actually what’ll fuel your urge to continue with the plan. Simply put, some savings is better than no savings. And, if you’re one of those who have the discipline to consistently deliver, nothing like it. You’re set. Go on and start saving.

Learnt a lot, didn’t you?

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Category: Money Management

About Nishant Lama

Learned to sing before he could talk. Trusts animals more than humans. Loves reading, bikes and beer. Finds joy in the colours of monochrome photography. Never touch his hair. Just never.

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