Everyone could use some extra cash – whether it’s to fund a new luxury purchase, investing in more stocks or just to see a much bigger number in our savings account to feel more secure in life.
Saving an additional $1,000 a year is easier than it seems and requires minimal effort. To save $1,000, you have to put away $84 extra each month. This starts with a review of your monthly expenses to reduce on cost items you don’t need or don’t even realize you have.
Here are fours ways you can trim your monthly budget.
1. Trim Monthly Bills You Don’t Need.
Most people have some bloat in their monthly expenses. These expenses were either taken on several years ago or on impulse. With the advent of convenience, most people may not even know what exactly they’re paying for, even if they know the amount it comes up to.
Land lines – Everyone has a mobile phone, so how much do you use it anymore? Cable Television package – It may sound cheap when all you have to pay is $10 for 5 more channels but are you really using it?
Broadband – M1 has rolled out its broadband charging just $39 a month. This looks like the most value for money deal if you don’t have heavy usage.
Mobile plan – Do you really use all your SMS and data allowance every month? Most people would be paying in excess of $50 a month in handphone bills; Singtel has a SIM only option that costs as low as $20. Don’t go for a higher tier plan just so you can get a bigger discount when buying the iPhone 6S, it isn’t worth your money in the long run.
There are so many ways people can save on different cost items. A prudent review of these expenses alone could save you $84 a month, or $1,000 a year.
2. Going Out Less
Even Obi Wan Kenobi goes out once in a while in his old age.
We’re not advocating that you turn into pale skinned mole rats or live like a friendless hermit-like Obi Wan Kenobi. If you’ve reviewed your expenses and realised that you go out for drinks every Friday and spend $100 each time, all you need to do is shy away one Friday each month.
If you find that you’re eating at a restaurant four times a month at a cost of $50 each time, you can consider cutting it down to just two times a month. If you find that you’re drinking Starbucks coffee every morning, consider drinking coffee from the office pantry (free!) or buying Ya Kun instead. There are numerous ways you can cut your budget by over $80 each month fairly easily.
3. Smart Grocery Shopping
Unfortunately, your kids are not an asset when it comes to grocery shopping
Grocery shopping is very necessary. It ensures you don’t have to eat out and that you don’t spend extra money on it. However, there are several pitfalls people don’t realize when they do their grocery shopping.
Taking your kids with you is fun and you get to enjoy a fun-filled family experience at the store. However, supermarkets are laden with traps for kids at the bottom shelves, from colourful and sugary cereal boxes to attractive toys and figurines. You can’t blame your kids – supermarkets have scienced the S&*t out the situation.
Another thing to take note of is to only go grocery shopping when you have a list of things you need to buy. This will prevent you from impulse purchases and purchases that are unhealthy and appealed to your craving at that point.
After you make your list, you should go buy products that carry generic house brands. More often than not, it is your cooking skills, rather than the ingredients that you are using, which results in bad tasting food.
4. Avoid Buying Too Much Insurance
People understand the need to be insured. However, most people do not know how much they should be insured for. Or the different types of insurance that they may or may not need.
Considering that we already have Medishield Life, the Dependant’s Protection Scheme, Home Protection’s Scheme and other forms of insurance bought by our company or our union that we may not even realize, some of us may not need as much insurance as what we think we may need.
If you don’t recognize the types of insurance we have just listed above, we suggest you first understand better what insurance are and what you already have before adding more to the list.
The next step is to find out how much insurance you really need.
Should you get $2,000,000 worth of life insurance if you only earn $3,000 a month? Probably not. Should you be saving $500 a month in an endowment plan or a whole life insurance if you earn $3,000 a month? Probably not. Should you be investing via an Investment Linked Plan? Definitely not.
And there are good reasons you should not be spending these amounts on such plans, even if you are able to save the extra money.
Defaulting on these so call “forced savings plan” if you cannot upkeep the contributions will wipe out a huge chunk of your savings. And if you read the news, and our site lately, some savings plans do not even guarantee the payout of what you have saved over the span of the policy!
There are many ways that a person could cut down on expenses without making a dent in their lifestyles. All it takes is a few hours of diligence and you could be $1,000 richer at the end of the year. There are many other ways we can think of such as –
Putting your savings into a savings account, like the UOB One account or the OCBC 360 account, which pays over 2% returns is a move that will build your savings each month.
Buying secondhand via apps mobile apps or going to a flea market will help you save on costs for certain items like books or home appliances.