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How to save money from salary
How to save money from salary

How to save money from your salary the easy way – anyone can do it

Start saving more money for your social trading account with these simple steps

If you’re wondering how to save money from your salary when you live paycheck-to-paycheck, you aren’t alone.

The average person doesn’t even have $1,000 saved for an emergency.

This could put you in a difficult financial position with even the smallest emergency, like your car breaks down or your water heater breaks.

Why does it feel so impossible to save?

It could be because you feel like you have to restrict yourself and this leads to overspending.

Instead, use these tips on how to save money and stop living paycheck-to-paycheck.

Create a Budget

You can’t learn how to save money from your salary if you don’t have a budget.

It doesn’t have to be anything fancy, a spreadsheet or even a pen and paper will do.

Track your income and expenses and see where you stand.

This step alone may make you more aware of what you spend.

It may be more than you think.

If you find yourself ‘in the red’ do some adjusting.

Figure out where you can cut back. If you can’t cut back, consider starting a side hustle or taking on a part-time job to increase your income.

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This step can take some time and soul-searching.

Give yourself the time to craft a budget that works the best for you.

Don’t copy someone else’s. Make it unique to your needs and you’ll see the greatest changes.

Pay yourself First

Before you pay bills or spend money, pay yourself.

This means putting money away in savings.

If you don’t have a budget yet, now’s a great time to create one.

Make one of your line item savings and allocate a specific amount.

If you can only start with $20, then that’s where you start.

Don’t focus on the amount, but rather on the habit.

Set up an automatic transfer so the allotted amount transfers directly to your savings account without any effort from you.

Cut Down your Expenses

While you work on your budget, look at areas you can cut back.

This doesn’t mean sacrifice, but rather a time to get honest with yourself.

Look at your expenses (pull your last 6 – 12 months of bank statements).

What areas do you overspend? Are they areas you could cut back and not feel like you’re sacrificing? Here are some popular tips on how to save money each month without feeling deprived:

  • Cut cable and get a much less expensive streaming service instead
  • Cancel unnecessary memberships and subscriptions
  • Make coffee at home instead of stopping at Starbucks
  • Cut down on the nail, hair, and other salon appointments
  • Minimize your shopping trips

Any money you save, direct to your savings account.

For example, if you cut cable and save $100 a month, direct that $100 into your savings account each month.

Create a Meal Plan

Groceries and dining out are two categories most people overspend.

Eating is a necessity so we figure it’s okay to spend what we spend on it.

If you don’t add up your spending, though, you may be surprised at how much you actually spend.

It’s usually too much.

Do this instead.

Pull your local store’s weekly sale ads and create a meal plan around what’s on sale.

Try to avoid buying anything that isn’t on sale.

If certain staples are on sale that you use often, stock up.

Then plan your main meals, especially your meats around what you can get on sale.

Create a meal plan for the week, including all meals.

Make enough dinner to have leftovers for lunch and cut out the fast food runs while you’re at the office.

You’ll likely be surprised at how much money you save each month with this simple habit.

Refinance your Debts

If your debts take up a large portion of your paycheck, figure out how to make them cheaper. The easiest way is to pay them off in full, but if that’s not feasible, try these tips as you earn how to save money from your salary.

  • Transfer high-interest credit card debt to a 0% APR credit card and pay the balance off before the intro APR expires
  • Refinance student loan debt to make the payment more affordable
  • Refinance your mortgage to take advantage of low-interest rates and eliminate PMI if you pay it
  • Consolidate your consumer debt into a personal loan with a much lower APR than your credit card debt

Adopt the 48-Hour Rule

If you’re an impulse-buyer, set up a 48-hour rule with yourself.

Here’s how it works.

Make a list every time you go to the store.

Even if you’re only going in for one item, write it down.

Focus on that list and getting in and out of the store.

If something catches your eye that you would normally just grab and buy, walk away.

Give yourself 48 hours to think about it.

Most impulse buy triggers disappear in those 48 hours, which means you save money.

If the item is still on your mind in 48 hours, think about how you’ll pay for it.

If you can’t pay in cash, don’t buy it.

Instead, create a plan to save for it and only buy it when you have the ‘free cash.’

You too Can Learn How to Save Money from your Salary

Don’t let yourself believe it’s too hard to learn how to save money from your salary.

Take one or two steps from above and implement them.

We recommend starting with creating a budget and going from there.

Once you have a plan for your money, you’ll see where else you need to make changes.

As you start saving, let the motivation let you make bigger and bolder decisions. Every time you find a way to save, direct the funds to your savings account.

Open a savings account that’s harder to access (an online high-yield savings account is great) and let your savings compound.

Farhana Chowdhu

Farhana Chowdhu

Farhana is a graduate electrical engineer having 10 years of professional experience in this field internationally.

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