Budget Tracker: 3 Tips to Save and Grow your Money
For most people, one of the most difficult things about saving money is figuring out how to get the process started. Not only do you need to focus on managing and saving your funds, but you also need to decide on the best ways to spend money wisely.
For instance, when it comes to budgeting and saving, one of the most popular strategies is the 50/30/20, which dictates that one should allocate 50% of one’s salary toward monthly necessities (i.e. bills, groceries, transportation), 30% to optional or discretionary expenditures (i.e. entertainment, travel, personal wants), and the remaining 20% to savings and other long-term financial goals.
If this type of strategy it too strict for your family’s household budgeting needs, don’t worry just yet. The stark reality is that many people in the U.S. have a savings problem. In fact, the entire United States hs seen major declines in its national savings rate for nearly 75 years:
In many cases, the best approach is to simply start from scratch and create a savings strategy that is specifically designed according to your lifestyle. Want to start building a better budgeting strategy right now? The following list offers some broadly defined budgeting tips that your family can use to manage finances, increase savings, and improve your family’s quality of life.
Set Realistic Financial Goals
Before anything else, a proper savings plan must start with an ability to identify realistic financial goals. What are you actually saving for? Are these things needed ASAP? Are they achievable?
Once we answer these questions, our budgeting goals should be classified into three categories: short-term goals (i.e. purchases of household furniture, pocket money for travel), long-term goals (purchase of a house, building an emergency fund), and life-long goals (i.e. retirement). Having these goals in mind (and sticking to them) can help prevent the mismanagement of finances that often leads to bigger financial troubles.
Promote Saving, Not Spending
While this tip seems like a no-brainer, saving more money can actually help you realize your dreams of buying a house or car, or achieving any other long-term family plans. One practical aspect of saving more money is that gives your family additional resources in the event a financial emergency arises.
Ultimately, we need to evaluate the things we want and determine whether or not they are truly important. This doesn’t mean you must stop buying nice things —you can, but do not overindulge. Furthermore, keeping track of house income and spending using budget tracking tools can help you decide whether to modify some of your expenditures for better financial control.
Focus on Earning More Money
Once you have accumulated a considerable amount of savings in the bank, it might be a good opportunity to take out some of that money and grow your net worth by investing in higher-yielding assets (i.e. bonds, mutual funds, or treasury bills).
Although investing may appear to be the opposite of saving upon first consideration, the reality is that both practices can have good returns when building wealth for the future. However, you should consider the risks that come along investment because these strategies also involve the potential for monetary losses.
Aside from investing, you can also earn extra money by starting a business or working online (i.e. as an affiliate marketer, virtual assistant, online retail seller, etc.). The major advantage of the latter is that it makes it possible to earn from the comfort of your home. There are also many reduced expenses when compared to traditional vocations, and all of these savings make their way right into your bank account!
While the aforementioned tips are just some of the ways to increase savings and grow finances, the decision to follow them is still up to you. Planning things properly and doing relevant research before taking any of these steps can pay significant rewards in the future.