Are you having trouble saving money? Do you realise that if something breaks at home, you’ll have to take out a loan? What if you lose your job, and you can’t even afford to pay your rent and other bills for 1 month? Does your money just slip away each month, and you don’t even know where it’s going? The art of managing money isn’t taught in schools. Either your parents will teach you, or you have to learn it yourself. This article will show you how to learn to save.
How to start saving?
Do you know where all your money goes each month? You probably have an idea, but it needs to be written down. You need a pencil, paper, and to keep track for at least 1 month. Every day, write down everything you’ve paid, really everything. If you like things to be organised, differentiate these things using, for example, different colours:
- Regular monthly essential expenses (rent, fees)
- Regular monthly expenses that aren’t so essential (these are things you pay regularly, but can live without)
- Food
- Toiletries
- Other
After a month, you’ll see where and how much money is really disappearing.
Promised tip
You need to change your mindset. Fill your pockets first, and then the pockets of others who are taking money from your wallet with good advertising. Of course, pay your rent, loan repayments, and other expenses necessary for life.
Where to create your own financial “pockets”
It’s good to save in multiple places, not just one. It doesn’t matter if you can put aside a few hundred or a few thousand crowns each month. The important thing is to put something aside. It creates a healthy saving habit. After a year, you’ll look back and see that it’s possible, and the money you’ve saved will motivate you to save even more. Here are a few tips on where you can stash your money:
- Savings account. Nowadays, almost every bank offers a savings account with no fees. However, the interest rates vary a lot, and you can view comparisons, for example, here. Use your savings account to create a reserve of money to help you with larger expenses, such as when your washing machine, television, or other essential appliance breaks down. You might also find yourself without a job.
- Building savings. This is a medium-term savings option, where the bank will pay out your money after 6 years, and you can use it for whatever you want. It’s good if you can contribute at least 500 crowns per month. The highest return is achieved with a monthly payment of 1700 crowns.
- Supplementary pension savings. This is long-term savings, where you’ll receive your saved money when you retire. The minimum monthly amount is 90 crowns, and the advantage is that you can’t easily withdraw and spend the money.
With building savings and supplementary pension savings, the state also contributes a small amount to your savings. This, of course, depends on the amount you contribute monthly.
If you have a bad month and can’t send any money to your building savings or supplementary pension savings, that’s fine, and there’s no penalty.
Loan
A loan, whatever it’s for, is a bad idea. Even if they promise the most advantageous interest rate in the world, it will always be unfavourable. You’ll pay money for borrowed money, and that’s simply not worth it. Money should bring you profit, not take it away. Of course, there are situations where you can’t do without a loan. In that case, try to repay the loan as quickly as possible, even if you have to find a second job.
So, will you continue to fill the pockets of others? Or will you decide to change that and fill your own? Usually, at the beginning of every savings journey, unexpected expenses arise, which can throw you off track. Don’t be discouraged and continue saving.
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