5 Effective Ways to Save Money… (based on experience!)

10 04 2011

Ever had a budget of ONLY 150 pesos for 3 days? I did. Read on to see how I survived and lessons learned along the way.

Want to sleep literally on money? Save and Invest!...

Have you ever reached down your pocket and saw nothing but lint?  Well I have and it’s the position I want to avoid as much as possible. So what I did was to check if I was making enough money or was I spending too much, more than what I had. Unfortunately I was the latter type. (I know right! I struggled believe me, that “Artwork” shirt was on sale! Can’t blame me though…)

I really didn’t care much about how much money I spend on things or food or whatever I laid my eyes on. But a contemptible moment in my life brought out the thriftiness in me. There was this time, a Monday of early last year to be exact, when all I had was 150 pesos and I had to save it until the next payout date. I was almost broke since payout’s a few days later, add to the injury, it fell on a Thursday that week. I was never really fond of borrowing money, probably because I know how it feels to lend money and never had it returned back *cough*”L-J”*cough*. He he he… Knowing myself, I knew I wouldn’t last a couple of days with just a hundred and so pesos, I tried my best to ask my roommate if they could lend me-  my ate, and colleagues but looks like we’re all in the same boat here.

So I did the impossible. Make a 150 pesos last for 3 days. It was not that difficult since I have free lunch at work everyday, so all I had to think of was breakfast, dinner, and fare.  I still got some leftover groceries from the week prior so I was confident I could pull it off. I remember buying rice and some few vegetables for a measly sum. I cooked “ulam” good enough for two servings. Breakfast and dinner solved! Lunch was provided for free so, nothing to worry about that. Fare on the other hand was much harder to budget since even though I only needed 14 pesos back and forth, for 3 days that’s already a hefty 42 pesos. And I couldn’t just walk to office, we’re talking about a good 50+ kilometres or so. Could not imagine arriving at the office all soaked up in sweat. Augggghhhh! That’s when I decided to give up snacks during break time. It was a good thing I actually bought some energy bars in my last trip to the supermarket, had to rely on these sugary sweets for a while.  I kept my budget in check all the time, to make sure I have enough to survive until Thursday. From then on I just kept on praying that everything would turn out just fine.

Then eventually it did! Finally, pay out day arrived. You could only imagine the relief I felt when dough came spitting out of the ATM machine. (That was exaggerated of course, just wanted to emphasize what I felt. It would be effin’ awesome if it did though!) Then it all came to me – how important managing money is. So the first thing I did was to correct my mistake and move on from there. I began listing my budget on a notebook. Income and expenses. Needs versus wants. Current and anticipated budget needs. One by one I was able to identify what actually placed me into this scenario. And it looks like I was just spending waaayyyy too much and too often.  The next steps I did were to look up additional things I could do to improve my situation. So here are the lessons I learned throughout this entire ordeal hope you find them useful too! No I did not take a 4-year course for this, no one has to. Although according to reports it helps a lot to be rational when it comes to money when you’re highly educated. I may not be an accounting major or a finance analyst but it’s just a matter of discipline I guess.

1.)  Create a personal budget – just like what I did, list down your expenses so you know where your money’s going. Check for little details on how you can save form day-to-day. Do you really need the coffee from the store? Will bringing in lunch cost less than paying for food in the cafeteria? Can you just borrow a book from a friend rather than buying an entirely new one? … I also make it a point to assign a portion of what you earn for savings, this is essential for your financial future.

2.)  Develop your art of spending – I know it’s not art per se but it just sounds so cool. Rethink your spending habits! Don’t buy it since it is on sale; think carefully if you really need it. Will you still buy it if it were not discounted? I’ve also read that being thrifty is not enough, there’s even some study suggesting that the “savers” spend more than the “spenders”. How? It’s a balancing act really. “Those who spend money like water don’t understand its value; those who shun financial planning and investing don’t understand its potential”. I also read somewhere that in every institution, there’s always both of these types to keep things in balance.

3.)  Follow up on Credit – I normally keep a list of people who owe me and follow them up once in a while, especially if they are owing a lot. Perhaps a few hundred to a thousand? Many people get discouraged when it comes to this, so it would be wise to make sure that you really REALLY trust the person you’re lending. Or else all that money will go down the drain. Trust me, it happened and it could probably be the worst mistake I’ve made. You could say it was ‘major major’ but nonetheless, it is from mistakes that we learn and mature. Speaking of credits, avoid “bad” debt like loans for personal use for non-important commodities, instead go for business or student loans could provide value over time.

4.)  Avoid paying additional fees- Greatest example would be the extra charges from withdrawing on an ATM not from your bank or fees for returning video rentals late. Also, if it is not needed to pay premium then don’t. This rule could also apply to commuting, by walking to your destination you only not save money but also help save the environment. Hitting two birds with one stone eh?

5.)  Shop wisely and never on an empty stomach! – Create a list! To avoid forgetting important items and making sure you don’t pick up anything that’s not essential. Also, make a budget and take a calculator to the store. I always do this to make sure I don’t go over board or if I need to, it has always to be within an acceptable limit. Avoid shopping when you’re hungry, it has been proven this leads to excessive & compulsive buying. Experts say it is best to shop at the outer aisles in a supermarket since “Produce, dairy, meats tend to be placed on the outer aisles with all the junk food and processed products in the center aisles. Avoid as many of those inner aisles as possible and you’ll see both your waistline and expenditures drop.” Specialists also advice to “…look below eye level. Bargain priced items are often shelved below eye level and out of your immediate view”.

Where’s the best place to shop? There’s no universal answer but canvassing significantly raises your chances of saving money. You’ll be sure to buy the item at the lowest price possible by doing so.  Add fun to window shopping by going out with friends to window shop, at least you have second opinion.  Clear-out stores are also places that are both savings-friendly and easy to see, very few people and lots of discount signs. Remember to search around carefully though, it doesn’t mean it’s on sale then it’s cheap.  Develop your haggling skills, this could come in handy to. From airline tickets to refurbished items; the important thing is to save even just a few bucks.

Yes it was certainly one of the toughest weeks of my whole life, but it was full of lessons that I needed to learn the hard way so it was worth it nonetheless. Right now, I am absolutely happy with the results of trying out these pieces of advice. Consistency plays a large role, so once you start, don’t stop! Seriously! I am planning on investing what I had save however that’s an entirely different territory I have yet to enter. I’ll start blogging about it when I get there but in the meantime these are all the tips I can share, oh and wait, never underestimate the power of the “piggy bank”. Even the tiniest of the penny / centavo is important, as our elders say “Hindi ka makakabuo ng isang milyon kapag walang ang piso” (You can never make a million pesos without a peso). Without a doubt there’s no overnight cure to stop spending compulsively or save hundreds of thousands of pesos, but if you start now then who knows you might be next millionaire just by saving! Ha ha ha! … 😉

"Save a centavo, you save yourself!"

Many thanks to the following websites who helped prove that saving money is actually doable:

Shine.yahoo.com

Ieke.com

Today.msnbc.msn.com

Moneyinstructor.com

Fitzvillafuerte.com

Photo courtesy of:

Uk-debtadvice.com

Bibokz

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New Year’s Resolution: Boon or Bane?

6 02 2011

Have been very busy again for the longest time, but finally I’d be able to keep up with the blog once again. I should’ve posted this last month. Anyway, I believe you’re familiar with a New Year’s Resolution List. You’re even probably either on your way to achieving your goal#5 or you wouldn’t want to start at all since you don’t believe in this kinds of things. I surely did not believe in its purpose until it came to me that goals are as important as the end results itself. I stumbled upon a website, which provided me the importance of motivating oneself to reach goals for self-fulfillment.  “Goals provide a sense of direction and purpose” (Goldstein, 1994, p. 96) . People will perform better when they are committed to achieve certain goals. That’s what I read. Just happen to forgot what website this is from so I apologize but rest assured as soon as I remember, I’ll modify this post. In the mean time, here is my personal list of what I want to change and achieve before the year ends. I’ve even segmented the list so it becomes a bit more organized:

Improve health:

–          Hard cardio exercises at least once a week

–          Light core and arm exercises everyday

–          Lose the belly!

–          Eat less burn more

–          Focus on whole-wheat and organic food groups for diet

Improve Finances

–  Save money for retirement

–  Manage finances by knowing what to prioritize

–  Favor quality stuff and invest in highly-productive activities

Improve career

–          Get promoted

–          Don’t let stress get in the way and stay focused

–          Find the suitable job in the media industry

Improve education

–          Learn the basics of a new language or dialect (probably French because of work and Kapampangan because of locality)

–          Finish reading at least five books

–          Be updated about current pop culture and the media

–          Watch at least a two new movies per month

Improve Self

–          Be less grumpy this year

–          Be more independent

–          Be more confident

–          Be more organized

–          Take more risks

–          Develop a forgiving attitude

–          Read the bible

–          Do something for the kid in me every month.

–          Reduce stress by laughing

–          Laugh some more!

–          Slow down when speaking

–          Before going to sleep,  remind myself of one thing I am grateful for

–          Be kind to unkind people (they probably need it the most)

Improve Blog

–          Personalize banner

–          Modify theme

–          Create at least a post every month

–          Impose quality in every post

–          Organize channels and headings

Being motivated is beneficial because it helps in putting oneself into action, improves efficiency by increasing productivity, leads to achievement of life goals, and fosters friendly relationships. So I don’t see any issues why having a list like this would be harmful. I know what you’re thinking, it’s a lot right?! Well at least now we have a lucid idea of what we want to accomplish. More or less the path is much clearer as compared to not making a list at all. By December for sure a review will be made to show how close I am in completing the goals. So now, I only have 11 months, so here we go! Wish me luck!… 😉

 

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Photo courtesy of Pharm marketing Blog