Before you can save money for a productive future, you need to be sure of the following savings rules, to make sure your savings plan is taken seriously and planned.
Give specific savings goals
In saving money, your goal is an important factor to help you easily build an effective accumulation plan and see the progress you are making. Determine what is important to you and what you want your future to be like. These are the easiest ways for you to set savings goals. Then, you have to know how much you want to save, over how long in time to reach those goals. After setting a clear goal, work on your savings regularly to increase your money over time.
Also, don’t forget to have a clear definition of your short-term and long-term goals to make it easier to allocate expenses properly.
Save early
You can choose from a variety of ways to save money in the future, but don’t forget to start saving early. Starting saving early means you will have more money and vice versa. As for money savings, the value increases over time. For example, if you choose to save money in the bank and start sending it from the age of 22 (after graduating and working), by the year you are 40, the accumulated amount will definitely be larger than when you do the next This plan is when you are 30 years old. So for the future to save money, let’s start early.
Save before you spend
We often have the habit of using money as we want, trying to cut down on spending to save. This economical approach sounds right, but it is not. The best personal financial management is saving before spending, saving first and then allocating money to other funds. Every time you have income, until the month you receive your salary, keep 10% — 20% for your savings fund, then allocate the rest to other essential needs. Always keep in mind, for money saving: Don’t save what is left after you spend, but spend the rest after you save.
Set up a backup fund for emergencies
Saving money for the future is important, but you must also pay attention to other money. You should set up an accumulation fund to prevent emergencies because future risks are unforeseen, unemployment, illness, accident … can all happen. If you have a backup fund, you will be proactive in some situations, and help you not have to touch the money you save for the future.
The billionaire John Paul DeJoria also advised that, everyone should have a sufficient provision for 6 months. You can save these money with interest rates of 2% or more until you need them.
Keep track of your expenses
Each person only pays attention to how much money each month their account has, but forgets to know how much they have spent each month. This leads to you do not know how to plan and manage your personal finances properly between spending and saving.
Keep track of expenses
Keep track of your monthly expenses
So keep an eye on the expenses to know which needs are spending the most budget each month, and then plan to cut accordingly. When you track your expenses, you will know which ones you should cut down so that you can plan accordingly for the amount you will cut and increase your savings. In addition, spend the most reasonable way, giving priority to essential expenses such as living, dining, utility services …. on the contrary, avoid unnecessary spending and emotional shopping.
Do not put all eggs in one basket
This is one of the cumulative investment rules that many financial professionals encourage everyone to adopt. “Do not put all your eggs in the same basket” means that you do not invest, accumulate all the money you have in a certain type of investment, accumulate a certain type of investment to minimize risk. Billionaire Warren Buffett once shared this lesson that, should accumulate a little investment in each industry, when one industry is in trouble, you can get capital in another industry to support. .