Five Ways to Improve your Saving Habit | Welcome to Linda Ikeji's Blog

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Friday, 24 April 2015

Five Ways to Improve your Saving Habit

The first step to improving your savings habit is to honestly assess your financial health. After all, you can’t solve a problem if you don’t know what it is. Improving your savings habit will help you reach your short- and long- term financial goals. Before you can save, you need to develop a clear picture of your expenses and your income. 

This will help you work out if you are spending more than you actually earn and help you to fix the situation by reducing your expenses – remember it really is easier to cut down expenses than it is to make more money. 

No matter what you’re saving for – whether it’s for retirement, a new home or a new car, or just to cultivate a habit of savings - it’s important to start early. When it comes to saving, the best time to start is now.

There are five (5) steps that will help you start saving:
          First, come up with a personal budget or monthly spending plan. This will help you plan for expenses, reduce excess spending, save for future goals, have money put aside for emergencies and prioritize savings. Separate your income and expenses but make sure that you update your budget regularly as these figures may change from time to time. Your income will include things like your salary, bonuses, retirement income (if you have retired), income from rents and things like that. Your expenses may be food and water, housing, clothes, transportation, education, utilities (such as phone bills, electricity, internet and such) and personal (such as hair and personal care).  Once you have estimated how much you will earn and spend, subtract your expenses from your income. If you have money left over, you can then decide how to spend, save or invest this left over money. If your expenses are more than your income, however, you must adjust your budget by reducing your expenses.
          Second, set realistic savings goals. Know what it is you are saving for and how much you need to save to achieve that goal. Make sure that the amount you are saving is meaningful but doable.
          Three, pay attention to your lifestyle; manage lifestyle inflation. Most of us will spend more money if we have more money to spend. As we move up in our careers, we tend to spend more. This is known as lifestyle inflation. Lifestyle inflation works against our ability to save and invest. You must remember that every extra naira spent now, is less money in the bank. People tend to spend more because they want to be and appear like other people – neighbours, friends, even family. But you must remember that these people may owe a lot of money for them to live the kind of life that they live. You need to decide whether you want to join these people in a life of debt or save to secure our families’ futures and our retirement.
          Fourthly, understand the difference between needs and wants. “Needs” are things that you must have in order to survive, such as food, shelter, clothing, healthcare, transportation and such. On the other hand, “wants” are things you would like to have, but that you do not necessarily need for survival. Sometimes it is difficult, especially these days, to tell the difference between the two but you must honestly do this if you want to manage your spending and save.
Lastly, explore savings accounts. The easiest way to save is to put the money in a savings account. Try as much as possible not to touch the money you save. To make sure that you do not touch this money you can put it in a high yield savings or investment account that has higher interest rates. Since your money must stay in the account for a period of time, this will help you to resist any temptation to touch it. 
These tips are really simple and if you stick to them, you should see an improvement in your savings. This has been courtesy Stanbic IBTC Bank as part of The Bankers Committee Financial Literacy Public Enlightenment Programme brought to you by The Bankers Committee, comprising all the commercial Banks in Nigeria and the Central Bank of Nigeria, CBN.
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40 comments:

Davido's driver said...

Thnx

SANDRA said...

But how can I save when Dollar has gone up?

Davido's driver said...

1 way to save. Avoid using atm debit cards.
2. Stop carrying xpensive girls.

Unknown said...

Nice one, amma put dis into practice. Linda take note!

SANDRA said...

But how can I save when Dollar has gone up?

Unknown said...

Nice one, amma put dis into practice. Linda take note!

Unknown said...

Nice one, amma put dis into practice. Linda take note!

Unknown said...

Davido's driver take note. You need to be saving your salary well.
Stop reckless spending of that peanut you earn.

Linda cogitate

Unknown said...

a.k.a EDWIN CHINEDU AZUBUKO said...
.
Gud tips.. I will take them into consideration......
.
.
***CURRENTLY IN JUPITER***

Unknown said...

Great points; point 3 caught my attention more.

Dat general said...

Informativ......makes me feel av nt made a wrong decision after all..tnks LindaBaby

Unknown said...

Great idea.

Rubylicious said...

#BabatundeRajiFasholaForFCTMinister

Unknown said...

Thanks so much for the enlightment.

Anonymous said...

SEEN...TOMJERRYSWIT

NaijaDeltaBabe said...

Na to do am remain na

Dat general said...

Informativ......makes me feel av nt made a wrong decision after all..tnks LindaBaby

Unknown said...

HMMMMMM

Unknown said...

Nice tips..



#TeamBlessed#

Debbie Chelsea said...

Was smilling wen reading dis,cos I do all this thinz.....I love saving....I dnt touch my savings,I always differenciate btw my wants n needs,its necessary...n again I always try not to leave above my needs,its very important as a lady,dis tinz have been helping me for years n has made me to be an independent lady

Unknown said...

Noted

Unknown said...

Maka y

Unknown said...

Thanks for this

Unknown said...

Good one ,thanks

Anonymous said...

Thanks mehn

Unknown said...

Definitely dis is real food for thought. Thumbs up to them for dis. Linda u r so wonderful.

Nky said...

This will really help

Anonymous said...

Nice...

Subomi said...

even if this was 10 pages I still would have read it

Anonymous said...

AnonymousApril 23, 2015 at 12:55 PM
Ure Doin a Gud job nd all ur post always send a msg nd encourages me now to my issue I dated dis particular guy for 5yrs nd we Ve broken up for upto 2yrs now nd it was really hard for me wen we broke up Bt eventually I got over it bt now he keeps keepin in touch nd wants to see me nd Weneva we see we jst talk nd laugh he Neva say anytin Abt Gettin back togeda nd to be honest I still ve a soft spot for him Wat can I do help me pls

Anonymous said...

Nice one

Anonymous said...

Nice one

Anonymous said...

Abeg all you need to do is calculate how much you spend on mobile recharge and data bundles for internet monthly for personal use, official use and you know girlfriend and side chics... #Mindblown

Mayor!

Anonymous said...

My natural life style,but i spoil myself once in a while :)

Anonymous said...

In my opinion, I think the best way to develop a good saving habit is to pay yourself first. From ur income put the amount you intend to save aside first and then plan ur expenses around wat u have left because when expenses come first, you discover that there is really nothing left to save.

Teacher said...

Reduce the meetings to when you have moved on and can comfortably say hi in passing

Unknown said...

Awesome.this deserves a comment.

Unknown said...

If u like,use all ur money buy shawama

Anonymous said...

Nice1, bt saving it's hard wen u hv more responsibility 2 shoulder n less income 2 earn. Bt hey nice job

Anonymous said...

i think i missed out somewhere and i have got some debt to settle....God help me ....i know i will bounce back to my saving ways.

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