Saving money may seem difficult, especially in an economy like ours where income of a greater percentage of people is small and runs on a tight budget, but it is possible.
You do not need to put a lot of money into your savings at one time, just make consistent deposits and it will grow steadily.
Here are some strategies to help you get started:
- Open a special account and deliberately not set up alternative banking channel including ATM cards on the account, so that you have limited access to funds in the account. The account should be used warehouse your special savings.
- Set up automatic deductions/standing order from your salary account, this should be deposited into the special account that you do not have immediate access to. You will be surprised what it will amount to in a little time.If you were only able to deduct #50,000 monthly from your salary, you would have saved #600,000 in a year.
- Put at least half of your extra income (salary raise, bonuses, allowances, cash gifts and others) into your special account. Do not “blow up” all extra income as it is with most people . It is extra income and in most cases unexpected and may not cause harm or disruptions to your budget if not earned.
- Cut your expenses and put the money you saved into your special account each month.
- Find a lower cost mobile phone plan and bank the difference.
- Take the money you spend every week on eating out and put it into your savings account instead.
- Collect your change. All the change you leave in the hands of petty traders, errand boys and girls can add up to hundreds of Naira over the course of a year, so collect them and put them into your special account.
- Another idea is to round up the cost of every purchase you make and put the difference into your savings. For example, if you spend #3,520, put the #480 into your savings.
- When you pay off a debts, do not raise your expenses, take the amount you were paying each month and deposit it into your special account.
- This may be tough, but do not raid your special account for non-emergency expenses like vacations or holiday gifts. It’s a way to build up investable funds.
Although interest rates on savings accounts are low, most experts advise maintaining a the account because you can get the money immediately when it is needed.
They advise against putting your saved money into stocks or other investments with any risk because there is always a chance you could lose the money you’ve worked so hard to save.