Saving money for yourself or for your family can be tricky. It can feel impossible, however there are some quick tips that can greatly assist. You can look at cutting costs and maybe a way to look to sell annuity for cash.
No matter what savings goals you are pursuing – with these ideas you can quickly save a lot of money in 2021 and increase your savings rate. Saving towards financial goals can take a long time, especially with high savings goals. However, in uncertain times, your savings create a sense of stability. If you’re wondering what ways there are to save a lot of money quickly, then you’ve come to the right place. Before you start putting money aside every month, you should use a budget book to get an overview of your total income and expenses. It is also worth taking a look at your debts, which cost you monthly interest. In many cases, there is great potential for savings here.
Get an overview of your finances
Saving starts with knowing your expenses and learning to set budgets for your family. To get a first overview, you should proceed as follows:
- For a month, write down all of your expenses in a budget book.
- Divide your costs into fixed and variable expenses.
- Calculate your monthly surplus to see how much you can currently save.
- You can hardly influence fixed costs (rent, insurance, etc.), but you can control variable costs such as food, subscriptions and hobbies well.
- Get rid of unnecessary variable costs and calculate your new monthly surplus.
- Set yourself savings goals now and distribute your surplus to the appropriate accounts.
Once a year, you should track your progress in order to stick to your goals. If you are overwhelmed, there are a number of finance apps that will make it easier for you to save.
Get rid of your debts
Before you start saving, get rid of your outstanding debt. Over time, they not only cost you nerves – but also interest. The longer you are behind schedule, the worse. Credit card and overdraft facilities are a particular burden on your budget. At around 8-13 percent, they are among the most expensive and common debts. Make debt reduction your top priority and gradually get rid of your creditors.
- You use 50 percent of your income to cover your “essential” living costs (rent, ancillary costs, insurance, etc.).
- You use 30 percent for leisure activities, subscriptions and vacations.
- The remaining 20 percent will go towards reducing your debt. If you are debt-free, you can save the money or use it on the stock exchange to build up your wealth.
Automate your savings with the multi-account model. To save money efficiently, you need to separate your savings account from your main account.
Automate the settlement of your bills
While we’re on the subject of “automation”: It’s also worth paying your bills automatically and not waiting for expensive reminders. So if you pay your bill before the due date, you save yourself extra payments. If you want to be on the safe side, set up direct debits so that you don’t have to worry about payment processing at all.