If you have allowed yourself to think there is simply nothing left to save, there is no need to despair. The following are some tips to help even those who think they are cash strapped to pinch a little away for savings.
1) Pay yourself first. This has been said many times over but it is worth repeating as still it doesn’t come naturally to most people. We tend to think that everything is more important than putting aside a little for savings from each paycheck, but actually this should be viewed as the debt that we owe to ourselves. Setting up a system of automatic savings is probably worth the fee charged by the bank if you don’t have the discipline to do it yourself. Your employer may also be willing to send a part of your salary to a different account and in that way you can avoid the bank fee.
2) Beware of credit cards. Credit cards can be marvelous vehicles for short term financing with the added benefits of cash back features or other built-in rewards. However they can lead to a quagmire of great proportions if not properly managed. Always be aware of all the features of any card that you use, some give up to 45 days interest-free while others start accruing interest from the purchase date. Make no assumptions about your cards and if you are not confident in your ability to handle the payments do not use them. The only smart way to use a credit card is by paying off the balance before the interest starts accruing.
3) Don’t toss your spare change. Many of us have scant regard for coins and they are tossed in every corner of the house. If this change was all collected in one designated spot and then taken to the bank periodically you would in effect be adding to your balance money that would have become lost in the abyss of stuff that collects around the house. It is easy to see that earning interest at the bank is a much better than collecting lint in the creases of your sofa.
4) Prepare meals at home. Again, we all know that it is cheaper and healthier to take meals that are prepared at home and yet so few of us actually put this into practice. A little discipline and lifestyle adjustment where this is concerned could pay great dividends.
5) Do not impulse shop. If you are not able to control your spending leave your cards at home and walk around only with enough cash to get what you need to accomplish done. It can be difficult to resist that sale sign and the games we play on ourselves to lessen the feelings of guilt do nothing to compensate for the gaping hole in our targeted savings at the end of the month. If you cannot control your urge to splurge at least ensure that you are not fully loaded and leave those dangerous cards at home.
6) Comparison shop. You can do this easily on-line or if you like to actually walk around and feel things out yourself visit the stores, but under no circumstances should you buy the first thing you see. Always check around for a bargain. You will be surprised at how much a little research can save you.
Turning saving into a lifestyle takes time and constant effort. Do not be discouraged if you do not immediately meet your goals, but at the same time ensure that your goals are realistic for your overall budget constraints. Saving does not have to feel like punishment. As a matter of fact, as soon as you start tying your savings to specific goals it becomes very satisfying.
By: Natalia Jones
Posts Tagged Assumptions
Money Saving Strategies
Nov 3
Managing money is not always about cost cutting. It requires analytical approaches that will indicate which part of the expenses should be minimized or totally eradicated. As such, there has to be measurements in managing money; and in terms of report, this is translated into what is called finance metrics. One cannot just simply decide that a certain process or machine be removed as it is expensive. Decisions based on assumptions are more likely to cause financial damage than assistance or resolution.
There are many aspects in managing finance. There are several Key Performance Indicators or KPIs that need to be incorporated in the report when finances are measured. One of these is job costing. Whenever there are projects that has cost, especially for manufacturing, a job costing analysis should be made. It is in this principle or light that a job costing report should be prepared so the managers will get a picture of what is transpiring. This way, they can also see if the investment is earning or if there is much potential for expansion.
Job costing shows people the total accumulated costs of a certain project, and this should include overhead expenses, too. Full costs are calculated against the revenue, and this is more often than not measured by department or division.
The first part of the job costing report is the job ledger. This should contain accounting transactions in a specific order. Normally, this contains job orders and job numbers categorized in a specific way for easy tracking. This contains revenues, costs, indirect costs, and receipts for all the jobs done for a specific project. The job ledger may be sub-categorized in different buckets to easily identify the pain areas in expenses and lost revenues. This may include current cost, purged job cost, billing cost, and invoice ledgers.
Another metric that can be used in analyzing financial status and movement is discounted cash flow. This is a method in appraising a company and its financial assets. Perhaps the downside of this approach is that it is based on the estimation of future cash out flow instead of current expenditures. However, this estimation is backed up by historical data, which is the foundation of any statistical study. Normally, discounted cash flow is only applied in investments and real estate development industries. However, its effectiveness in gaging financial performance has led it to become one of the most used tools in financial studies.
Discounted cash flow may be confusing to some. The problem is that this is not based on simple addition and subtraction. There are a lot of financial formulas that need to be used because one has to factor in the value of treasury notes and the span of time that has elapsed since the assets were purchased.
In general, people who want to manage their finances should consult an expert in finance management, whether this is personal or corporate finance. It is always best to consult experts when developing finance metrics, to be sure that the things being measured are ultimately aligned with the goals of the company.
By: Sam Miller