When you are flowing, money may be flowing but it may be time to consider an aggressive saving strategy to be able to meet your financial goals faster. It is because you live in a world where you have much more reasons to spend money than actually, you do to save it. You just need to shift your mindset into saving more than you spend. It will help you to ease the saving process and progressively save more as your budget allows.
It begins by cutting back on your spending and the way you can do it by start living on half of your income. in today’s economy, it is very smart to save half of your income and even if you can’t do it, you can aim to get pretty close to it. Once you start living on half your income, you prepare yourself to spend less and save more. Following are the ways with which you start living on half your income:
Keep a check on your spending for a month:
For saving more, you need to track your spending pattern. It is similar to any diet before which you track what food you eat and deciding what needs to be changed to achieve your goals. This same concept can be applied to your financial health for which you will need to track your spending habits for about thirty days. Review the spending on a weekly basis and take inventory of necessary purchases as well as any impulse purchases that you make. Once you know the things you are spending on, cut the expenses on unnecessary items and focus only on things that are necessary.
Spend money only on the essentials:
You can build up willpower by spending money on just the essential items for the thirty days. You need to decide in your mind that these thirty days will be the time when you will make purchases of only the items you are in extreme need of. When you will successfully shift your mindset towards it, you will thank yourself later for this important change.
Set an amount to be saved:
Once you are able to track your spending for thirty days and are strong enough to spend only on items that are necessary, it is time to set the amount you want to save. You need to open up an account and decide how much you want to save on a weekly, monthly, or biweekly basis. The key is that the amount you want to save should not at all hit your spending account and should be automatically be transferred to the saving account.