13 Beginner’s Guide to Spending Less and Saving More

There are many facets one should learn as they become more of being a full-fledged adult, and one of those smart financial management. As kids, we are taught some simpler ways we can do this. As we grow up however, we are faced with the reality that we have more responsibilities now more than ever — rent, transportation, bills, food, etc. Everything’s now on our hands and keeping any excess money in a piggy bank just doesn’t cut it anymore. 

I wouldn’t say I have the world’s best money-saving habits; I still have a lot to work on. But as years pass by and I became more independent, nay responsible, I also became more sensitive to where my money goes. 

Here are a couple of personal tips I’ve learned over the recent years:

The first key thing to knowing how to save money is understanding your own spending habits. You can easily do this by jotting down approximates of what you typically spend monthly. Or if you wish to do it accurately, by using a wallet tracker such as Wally where you plug in your expenses for the day and categorize them accordingly. From there, you will at least get a rough idea on where your money goes and what type of expense you usually bank on. It’s completely up to you if you wish to do this religiously but remember that the goal is not to know the exact figures but to have an idea where your money goes.

Review these expenses. Most especially on where the bigger portion of your money is spent. Criticize your own spending habits from an outsider’s point of view and justify it from your own view. Do you really need to spend this much on food? On clothing? On entertainment? On miscellaneous things? 

Once you realized where your shortcomings are, build a budget that works for you. Whether it should be strict or not is your decision; you know yourself better than anybody else. I’m not here to tell you to scrimp or splurge on yourself but you have to be honest about how you plan to spend and what you plan to save.

Have a clear goal in mind. We all have differing motivations when it comes to saving money but it is important that it goes hand in hand with building your budget. Personally, my financial goal at the moment is to save enough money to travel and to have something for emergencies or future plans. From there, I’d check if my budget is in line with my goals and create actionable steps to reach that goal.

Have two to three separate bank accounts. Not only is it to have a back up in case there is some inconvenience with your primary bank, it’s also to help yourself differ your money. Have the primary as the receiver of payroll and the second as your transactional card. Transactional meaning a card you will use to make your monthly purchases, pay bills, do online shopping, etc. I use my payroll card as my savings card as well since that is where I plan to base my bank certificates for official documents from. But should you wish to have another card solely for savings and emergencies, by all means, do it. 

Be wise about credit card use. I’m not going to talk about the finer details of this since I actually don’t own one and don’t have plans of having one anytime soon. But it is no rocket science to be extra careful about them and only use them when absolutely necessary. It is so easy to think of going on a shopping spree when you have limitless money available however always remind yourself that this is not money you have earned for; it’s borrowed money.

Plan your expenses. For many of us, we know how much money should we expect to come in. It’s fixed. If that is the case, we should always be proactive in planning how we spend. If there is a big expense coming up quite soon, we should be planning around it accordingly and adjusting what other expense we have in mind on a later time. 

Control yourself from spending with a wishlist. If you are like me, I have an endless wishlist of aspirational things I’d like to have. If I didn’t have control with myself, I would’ve purchased all of them at once and left myself endlessly broke each month. But I learned to bank these things on my wishlist until I’m financially stable enough to have them and put them off as long as I don’t crucially need them. I also learned that by doing this, I give myself enough time to do my research and ask myself if having these things would add any value to my life. If the opportunity to have them for a fraction of their price is there, I’ll think about it. Otherwise, they stay in the list.

Do an inventory of your belongings. In line with the previous tip, scan first the things you already own and ask yourself if you really need to purchase a duplicate or something similar right now. You will most likely discover that you have fully functional things that didn’t need to be replaced any time soon. Too many times we are engulfed by the idea that we need more, when we actually don’t.

And while we’re on the subject, use your things until their wear and tear. Or give them to someone who really needs it or will make better use of it, should you really want to get rid of it. Most of the time what happens is, we subscribe to new kinds of lifestyle that we immediately want to jump and decorate ourselves in the same fashion when doing so means you’d have to give up a lot of belongings that are perfectly fine anyway.

And most importantly, aside from buying only when it’s needed, is to buy things of quality. This didn’t even need to be discussed but it is so much better for your wallet to buy things that do not need to replaced or scrapped after a few use. There are things you can definitely scrimp here and there, yes, but understand that some things will eventually cost a fortune if you get them for cheap. 

Think of other ways to earn aside from your job. I know this is not part of saving per se, but it is related to having more money to save. You cannot just rely on your 9-5 job forever. At some point, you have to start thinking of another income stream. I’m not going to get into details of whether should be a passive income stream or labor-intensive one. You have to know what would work best for you. Start reading, start getting more knowledge about this. Invest in knowing how to make your money grow. 

Live within your means. I’m almost certain you’ve heard this somewhere but in order to save, it is crucial to pattern your lifestyle to how much you’re earning. I’m not saying you can’t buy lavish things if you’re not earning much; what I meant is, if you’re living uncomfortably in other important factors of your life just to own luxury goods, is it really worth it? As much as you can, don’t buy the idea that you have to look a certain way just to let people know you’re made of money. 

I know my tips aren’t really anything new or mind-blowing, but it pays to be reminded of them once in a while especially when need a little bit more push to get to where you want. As much as possible, I want to give you tips that are easily actionable and doesn’t take a genius to figure out. These are tips you can even start right now. 

Later, I will let you know an embarrassing bit of me, yet again — the worst financial mistakes I’ve done as of yet. I’d like to know some of yours too, in advance. Please share them if you can/want to in the comments box below 🙂