Warren Buffet used to say “Do not save what is left after spending, but spend what is left after saving.” Super savers have this in mind at all times as they manage to save more than half of their income through very witty ways.
Their methods might differ from ours, just because they found methods that aren’t extreme, but very smart and can take their savings to the next level.
Millennial Dollar has made a thorough research on their unique approaches in order to help you implement new techniques to your saving strategies.
1. Track ALL Your Expenses
This little hack stays at the basis of budgeting and organizing your money. By being aware of where each cent is going, you will be able to know exactly how much you have left for your extra spending.
You can use the traditional pen and paper and note every expense you have to do in a notebook. Or you can simply download an app and allow it to help you keep track of everything, such as Mint or Spending Tracker.
While it might seem easy to simply estimate your expenses in your mind, there’s a good reason all millionaires and super savers use the method. By seeing in front of you all the expenses, and being able to compare them to previous months, you become aware if your habits should change. By using automatization to put aside for debt and savings, it will help you use ONLY the money meant for spending.
You can learn more about budgeting and saving in our How to Budget Money on a Low Income? 4 Ways to Save Money article.
2. Use the House Hacking Method
This strategy can completely thin the burden of paying rent of mortgage. This means if you own a house, rent your free room and pay the mortgage with the money – or if you are debt free – use them to pay the utilities.
Other people use this method when buying a home, and immediately after, instead of living inside it, they rent it out and pay the mortgage with the rent money while they stay with their parents of in a much cheaper rent. This is how can you save half of your salary and more, as rent or mortgage is the highest monthly expense we all have.
Vay Namae, a real estate agent known for her helpful Tik Toks regarding buying houses explains it in the video below:
3. Watch Out on the Food Expenses
Most of us think food is an expense we cannot live without – and it’s true, up to a point. Financial experts have showed that people with lower and middle incomes can spend more on food than necessary. Excluding the dinning out, starbucks and other fun activities, this is how you save big time on food.
First of all, you make a list to everything you need and you stick to it. Studies have showed that hypermarkets are designed in a way that will make people buy with at least 25% more than what they initially came for.
So besides tracking the items that you need and only buying those, you can also:
– buy in bulk
– freeze your food
– make a weekly plan for the meals
– don’t shop when you are hungry
– store food correctly to prolong their availability
– compare prices to different hypermarkets and shop for the best deals
– take advantage of discounts, coupons and apps offering bonuses
By respecting these steps you can definitely save half of your income, as mortgage, utilities and food are the most expensive in our list.
4. Transportation
Transportation costs can be a major expense for many people, but there are ways to reduce these costs.
Use public transportation: Compared to having a car or calling a cab, public transportation can often be substantially less expensive.
Bike or walk: If at all possible, opt to bike or walk rather than drive. You could cut off completely the costs of petrol and parking thanks to this.
Consider carpooling to work or other occasions if you have coworkers or friends who live close.
Download ride-sharing applications: Use apps like Lyft if you need to employ a cab or ride-sharing service.
5. Write Down Your Goals
Brennan Schlagbaum is a financial expert and a millennial on track of becoming a millionaire by 31. He shares how writing down clear goals helped him pay each of his debts.
Brennan used to write all his money goals on a whiteboard, and by seeing them each day kept him motivated and reach them sooner.
His advice on writing your money goals is to split them into 1, 5 and 10 years targets. On top of this he recommends having a calendar with a daily schedule to help you be aware of all your tasks.
| Also read Learn from these 10 Billionaires on How to Save BigBucks
