Tips on Saving Money

Want to stop living from paycheck to paycheck? Read on and start saving today.


1. Figure out what you need to save for and how much you need to save. For short-term goals, this is easy. If you want to buy a video game, find out how much it costs; if you want to buy a house, determine how much of a down payment you’ll need. For long-term goals, such as retirement, you’ll need to do a lot more planning (figuring out how much money you’ll need to live comfortably for 20 or 30 years after you stop working), and you’ll also need to figure out how investments will help you achieve your goals.

2. Set savings goals. Once you determine how much you need to save, establish a timeframe (i.e. “I want to be able to buy a house two years from today.”) Set a particular date for accomplishing shorter-term goals, and make sure the goal is attainable within that time period. If it’s not attainable, you’ll just get discouraged.

3. Figure out how much you’ll have to save per week, per month, or per paycheck to attain each of your savings goals. Take each thing you want to save for and figure out how much you need to start saving now. For most savings goals, it’s best to save the same amount each period. For example, if you want to put a $20,000 down payment on a home in 36 months (three years), you’ll need to save about $550 per month every month.

4. Add together the installment amounts (monthly, weekly, or per paycheck) for all your savings goals. Can you afford to save this total each period? If so, great; if not, proceed to the next step.
Keep a record of your expenses. Write down everything you spend your money on for a couple weeks or a month. Be as detailed as possible, and try not to leave out small purchases.
See where you can trim your expenses. You’ll probably be surprised when you look back at your record of expenses: $300 on ice cream, $100 on parking tickets? You’ll likely see some obvious cuts you can make. Depending on how much you need to save, however, you may need to make some difficult decisions. Think about your priorities, and make cuts you can live with.

5. Reassess your savings goals. If there’s absolutely no way you can fit all your savings goals into your budget, take a look at what you’re saving for and cut the less important things or adjust the timeframe. Maybe you need to put off buying a new car for another year, or maybe you don’t really need a big-screen TV that bad.

6. Make a budget. Once you’ve managed to balance your earnings with your savings goals and spending, write down a budget so you’ll know each month or each paycheck how much you can spend on any given thing or category of things. Try to leave a little room for minor unexpected expenses.

7. Stick to your budget. A budget won’t do you any good if you don’t follow it religiously. Build some self-discipline, and remember why you’re on a budget in the first place.
Pay yourself first. Savings should be your priority, so don’t just say that you’ll save whatever’s left over at the end of the month. Deposit savings into an account (or your piggybank) as soon as you get paid.

8. Open an interest-bearing savings account. It’s a lot easier to keep track of your savings if you have them separate from your spending money. You can also usually get better interest on savings accounts than on checking accounts (if you get interest on your checking account at all). Consider higher-interest options such as CDs or money-market accounts for longer savings goals. Shop around for the best interest rates on an account that fits your budget and liquidity (how quickly you need the money) needs. For very long-term goals, such as retirement, you’ll need to develop an investment strategy, not just a savings plan.

9. Consider automatic deductions from your paycheck. Many employers allow you to deduct savings from your paycheck. The money is directly deposited in your savings account so you never even see it on your paycheck. You can also have investments for retirement taken directly out of your pay, and the taxes may be deferred with this option.


a. If your savings timeframe is very long, such as that for retirement, you may want to structure your monthly savings so that they grow larger later in life when you will (hopefully) have more income coming in.

b. If unexpected expenses cause you to deviate from your budget from time to time, cut unnecessary expenses before you cut money from your savings goals. Other than the bare necessities, your savings goals should be your top priority.

c. In this day and age, many of us have cars, so saving money on gas can contribute to your effort considerably. Consider getting rid of the car altogether if you can. See the related wikiHows for more information.

d. If unexpected circumstances render you unable to meet your savings goals, reassess them and figure out which ones you can delay or cut out. Get back on your program as soon as you can.

e. For very important or very large savings goals (such as a down payment on a house or saving for your kids’ college tuition), consider opening up a separate account. You’ll be able to keep better track of that particular goal, and you’ll be less tempted to dip into it.

f. If you receive unexpected cash, put all or most of it into your savings, but continue to set aside your regularly scheduled amount as well. You’ll simply reach your savings goals sooner.

g. If you no longer have a regular expense, such as when you pay off your car or home, set aside that money into savings. You’ll be paying yourself instead of somebody else.

h. Make paying off high-interest credit card and loan balances a top priority. You can’t really save money when you’re needlessly wasting it on finance charges.

i. Buy a piggy bank for your coins. Coins and change may look insignificant but when accumulted overtime they can help you save.


  • Never loan cash to others that you cannot afford not to get back.
  • Never borrow money that you cannot repay.
  • Do not go out "window shopping" with any money on you. You will only be tempted to spend money you cannot afford to lose.
  • Be sure to keep track of automatic deductions from your paycheck. Sometimes mistakes happen, and if you’re not paying attention, you might not get all your money.


1 comment:

  1. Great tips to save money.But the thing is, most Pinoys don't know how to save as they certainly will say they are not earning enough money for their monthly expenses.


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