Savings – this is income not spent, or also known as deferred spending.
Having savings is good to have something during the figurative “rainy days”.
I have been known by many of my friends to be a thrift-wart in so many ways. When it comes to food, I complain if we dine in an uber expensive restaurant but the taste and service is BLEH! When it comes to clothes, I seldom shop at branded stores (unless there’s a sale… and by sale, I really mean real-deal SALE like super marked down prices. If that’s the case, you’ll see me running towards that store. Lol). And when it comes to travel, I am the queen of DIY-ing – buying promo fares a year before the trip, non-stop research on the internet during free time, budgeting food, reading on forums on ways on how to save money while being on that particular country, etc.
Yep, that’s me. That’s how I do it. Some would spend a hundred K Pesos per trip because they’d get tours, tour guides, etc. I’m not saying that’s bad. Tours are definitely beneficial if kids or oldies are around. If you have the money, go for it. But if there’s a way to save up those extra Pesos then I am totally up for it. As for the clothes, no need to buy expensive ones just to look good. That’s a given. Some would think dressing up in those popular brands would make them look more good, but na-ah! Wrong! Give a girl a 100 peso dress and she can work it! The price won’t show on the clothes anyway. Take note, it’s confidence that stands out which makes the clothes and other things follow. Oh and for food, I admit I have been traumatized a couple of times. Saying that oh this restaurant serves the best chicken in town but costs PPPP… so I’ll be like okay, I’ll try it out then BOOM! Tastes just like the ones being sold outside for Php 25. That’s how I learned that it’s okay not to dine at fancy pantsy restaurants. Just on special occasions – that’s the exemption.
Another tip that I share to my friends and those who keep on asking me about how I save money is the term “PAYING YOURSELF FIRST”. This is applicable for those who receive allowances or salaries may it be on a daily, weekly or monthly basis. My case would have to be semi-month (every 14th and 28th days of the month).
The common practice of others would be spending their money and saving what’s left of their money a day or two before the next payday arrives. This is not what should be done. What will happen is that sometimes there won’t be any left even before the next payday arrives. So where’s the savings now?
Say for example I receive 5 Thousand pesos per payday (net income). What I do is that I pay myself Php 2,000, and the 3,000 left will be my DISPOSABLE INCOME. For the next days before the next payday, I will be working on spending just 3,000. I will work around that amount. Of course, the amount you will pay yourself will depend on the situation. Some are breadwinners of their family so maybe they can set aside 500 pesos per payday then work around on the rest. That 500 pesos per payday can still go a long way. Whatever amount being set aside per payday, when accumulated, can really be of big help in case the need arises in the future.
Another tip that I would like to share is learning the art of loving-hating bank accounts. Love your bank account to the point of feeding it by depositing money in it every now and then (your savings, of course), and hate your bank account to the point of not paying attention to it and leave your money there and seldom forget it's existence. Now of course, if the need arises, that’s the time you get to go back to your bank account and withdraw some money. Make yourself a "fair weather friend" of bank accounts and just remember it's existence when you need something. Good analogy, right?
It would also be nice to pick a bank that earns a bit of interest monthly, quarterly or annually. Interest is not that much but hey, it’s better than nothing.
Here’s what I also do on a personal note: Let’s go back to the 2,000 per payday self-payment. That 2,000, I break it down to certain “ACCOUNTS” – 500 shall be set aside for Christmas, 500 for my Birthday, 500 for Travel (where I can get money to pay for tickets, pocket money, hotels, etc) and 500 for what I call the Lifestyle account (shopping, personal needs, etc) = Php 2,000. Through this, I know how much I should spend for each account. If I have 8,000 pesos in my Bday Account, I should spend more than that during my birthday. And what’s great about it is that I have a certain amount set aside for a specific reason. That is what I always do.
Here’s a screenshot of a sample ledger but is very similar to what I have.
So every payday, I log the 500s that I set aside per account
Then during the days when I need to use from a particular account, I also log it and put on the Remarks section what that money is intended for.
By doing this, I can see the total of each account and how much I should spend per account.
This also teaches me discipline at some point.
So that, my friends, is just some of the ways I get to save money. I hope this will influence more savers like me.
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