It’s hard to save money when you don’t even have enough money to begin with. There seems to be no point doing so when you’re already broke AF, right?
Well, you're not alone in this dilemma. For most young professionals who are living from paycheck to paycheck, saving money is probably the last thing on their mind, considering how brash their spending habits. However, your small income should not hinder you at all from stowing away extra cash for the proverbial rainy day. “Even if what you save is just a little, at least you are starting somewhere,” financial advisor Jenna Chua says.
“For those earning P20,000 gross income a month, your take home pay (minus all the deductions and taxes) is most probably around P15,000 to P17,000 (depending if you're single or married) a month. If you’re single, this amount is enough for all your personal bills and expenses. On the other hand, if you have dependents, budgeting this might be challenge,” she says.
The more you have people relying on you, the more necessary it is to put some of those earnings away for the future. How do you do it when you have little to spare per cut-off? Here are some tips to get you started.
1) Cut unnecessary expenses
The fastest and easiest way to save some moolah is to limit your expenses. “First things first: Gather your monthly bills, study them, and decide on what's necessary," Chua explains. "Do you need an expensive data plan for your smartphone? What about that monthly gym membership that you barely use? You may think of these as essential, but in reality, they're just luxuries that are draining your budget.”
2) Evaluate your spending habits
“You also might need to assess your spending habits,” she says. For example, if you're fond of buying branded products, why not try local or lesser-known brands instead? “Just because generic brands are cheaper, it doesn’t necessarily mean they don’t work as well as the more expensive brands. Choosing this option can instantly save you some money.”
3) Pack your own baon
Buying lunch every day is a surefire way to blow up your expenses. It’s best to bring your own food to work. “Having no time is not an excuse to not bring your own baon,” Chua stresses. “If you want to save money, you need to make some time for cooking at home. Try to make good-for-one-week meals over the weekend and freeze them.”
4) Write down your budget
If you don’t have a list of your expenses, make one. “Writing down your income, your expenses, and everything that pertains to your earnings and spending is important. You’re an adult, it’s you’re responsibility to know what happens to your hard-earned cash,” Chua notes. Just like with every life-changing decision, saving starts from planning, and the planning begins with budgeting.
5) Write your financial goals
“The best motivation is having actual financial goals,” Chua suggests. “Financial goals can be as basic as opening a savings account, being debt-free, or saving a particular amount. It all depends on you. Start challenging yourself! No income is little when it comes to your determination to be rich someday.”