How to develop a good savings culture is a skill everyone needs to horn. We do not always have the money ready to get right financial expenses or emergencies that’s why it is considered very important to have some savings ready for a difficult time.

Developing a good savings culture can pose to be tiresome and sometimes one can begin to fall short on it, which why we want to help you develop a good savings culture to help secure a great financial future with these:

10 step-by-step guide on how to develop a good savings culture

1.Record your expenses

For every purchase made should be recorded. This includes money leaving your pocket, such as a tip to the waiter or a homeless person. Once you have collated all your data and arranged them categorically, you can have full knowledge of how to manage your money efficiently and help you save better.

You can use free money management tools to help keep you on track and focus on your goals.  

2. Have a budget

Now that you know your financial stance and how much you’ve spent in a month you can begin to plan and control how much you are going to spend in the coming month by having a detailed budget. Having a budget for your money helps you to not spend money unnecessarily.

To avoid a financial crisis, it is important to know how to create a budget, this is a step closer to achieving your financial goal.

3. Cut down unnecessary expenses

If you’re saving towards a certain goal and your income is not proportional to your expenditure, you would need down to cut down some unnecessary expenses. By doing this, you have enough to save and attain your goal faster.

You may want to reduce going out with friends to your favorite restaurant every Friday, cancel that subscription or membership you no longer need. Avoid spending on your wants and focus on your needs to achieve your financial goal.

4. Set a SMART financial goal

To have a better saving habit, you must set a goal and your goals must consist of five simple things. It must be;

• Specific
• Measurable
• Attainable
• Realistic
• Timely

Once your smart goals are set, make an action plan to help tackle each goal one after the other. Your goals could be short-term(1-3years) for example; a vacation, a new car or a new phone and so on. Long time payments (4+ years)for example; retirement, a trust fund for children, saving towards an investment plan etc.

If you’re saving for a long time goal is best to put your money in an investment account or figure out ways to invest your money so that it will pay off in the future. Although investments are a lot of risks, with the right investment plan, your money will be secured whenever you need it.

5. Set a fixed percentage

Setting a fixed percentage out of your income to be saved monthly is a good way to build your savings. If you’re having troubles staying diligent to this, you can always auto-save from your bank to your savings account. Several money management tools help save your money automatically by removing a fixed amount of money from your current account to your savings at a certain time daily, weekly, biweekly, monthly or even yearly depending on the goal you are set to achieve.

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6. Be debt free

Debts are one of the obstacles that can hinder us from having a good saving culture. To save towards your financial goal, learn to use your money wisely and avoid debts. If by chance you have debts to pay, start by paying them little by little that way you are not tempted to spend out of your savings and you can still reach your financial goal.

7. Make a habit of paying yourself first

It’s easy to save when all the bills are taken care of, the rent is paid, light bills have been sorted out, the house is stock up with groceries and so on. However, what happens when all the bills aren’t taken care of, how do you still maintain the habit?

You must start by paying a realistic amount of money to yourself first, it could be 10% of your earnings every month. So when the bills begin to pile up you can still maintain your 10% monthly, you can also decide to increase it whenever your income becomes more than usual.

8. Grow your money

You have worked hard enough for the money and you have saved enough, now let the money work for you. Analyze your progress and review your budget every month, this will help you stick to your personal savings plan and source for more ways to grow your wealth and achieve your goal faster. 

To expand your wealth, you need to invest money in a product that will yield you a good return on investment. Whatever you decide to invest in, make sure its long-term to enjoy the benefits in abundance.

9. Positive mindset

It is important to keep a positive mindset towards saving money, this helps you save better. When you save better you are gradually achieving your financial goal.

Always keep your head above water when it comes to financial responsibilities, just like quicksand you can easily sink to the bottom upon the slightest fall.

What else did I miss on how to develop a good savings culture ?