Sharing a few basic savings tips to celebrate savings month.
It is not difficult to save money, especially if you are conscious about saving rather than overspending. With a mindset to save money, you will find ways to save money. It is not necessary to only look for big savings since multiple small savings have the same effect as a few large savings. It is much easier to find smaller savings in your budget. Focus on these smaller savings as every little bit helps. Small savings quickly add up and before you realize it, you have started to save money.
Here follows a few basic savings tips to consider:
Don’t spend unnecessary money on bank charges
Review your bank charges on an annual basis. Negotiate with the bank that you get the most cost-effective package available that suits your needs. There is no point in paying for services and facilities that you don’t need or use.
Life insurance should match your circumstances
Life insurance is a necessity in your overall wealth portfolio. The main objective of life insurance is to cover your outstanding debt, followed by the needs of your dependents. If you have no dependents and little or no debt, you don’t need millions of life cover. Carefully consider reducing your life cover and save by paying a reduced premium, but still ensure your life cover is sufficient.
Insurance on clothing accounts and cell phones, etc.
Insurance on clothing accounts, cell phones, etc., can come in handy when something goes wrong or your belongings get lost. However, don’t tick every insurance option box of every item you are buying. Determine if the total insurance costs are justified considering your risk profile as well as the replacement cost of the item. Saving on insurance premiums may be sufficient to replace a lost phone. An emergency fund may be a lot more cost-effective to replace items like cell phones than taking out expensive shop insurance that is priced for high risk clients.
Review short-term insurance regularly and update accordingly
Short-term insurance policies should be reviewed on an annual basis and updated to match your current circumstances. Updating your car’s market value annually on your car insurance policy could result in significant savings that could be invested in your emergency fund, etc. In theory, your insurance premium on your car should reduce as the car’s market value reduces but the onus is on you to ensure that the policy is updated.
Be aware of exclusions on policies
Spend time understanding what is excluded from policies before you commit. A policy should match your circumstances, your needs and your potential risk profile. For example, if a woman has a dread disease policy which doesn’t cover breast cancer, she needs to think carefully if the policy really matches her risk profile of potentially contracting breast cancer. Don’t pay for a policy only to discover that it doesn’t cover a required item, disease, etc., when it is too late.
Be aware of ‘too good to be true’ deals
When a deal sounds too good to be true, it most likely is. Don’t fall for every person calling you with the best, cheapest deal ‘exclusively for you’. You can only use one cell phone at a time – you don’t need two or three ‘free’ cell phone contracts.
Take care of your health
Take good care of your health. Go for regular health checks, eat a healthy and balanced diet, exercise regularly, quit smoking, limit alcohol consumption and control your weight. Take multi vitamins and immune boosters, especially during winter time. Prevention is always better than cure.
When you adopt a savings mindset, you will always find effective ways to save money. It is possible to save money and still enjoy life.
This article is an extract from the Financially Fit and Wealthy book. The book (hard copy or e-book) can be ordered on the website.
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