How to Minimize Expenditures to Make Your Finances Safer
No matter how much income you have, if you don't control your expenses it will quickly run out. Minimizing expenses does not mean... See more
How to Minimize Expenditures to Make Your Finances Safer
No matter how much income you have, if you don't control your expenses it will quickly run out. Minimizing expenses does not mean being stingy. But this means it's smarter to manage your money so you have some left over for savings, investments or an emergency fund.
This is the most effective method that you can immediately practice:
1. Create a Budget and Record All Expenses
The first step is mandatory.
How: write down all your income, then divide it into 3 main posts: Needs, Wants, Savings.
Use the 50/30/20 rule. 50% needs, 30% wants, 20% savings.
Record it every day using an application or book. From here you will know where your money is leaking.
2. Differentiate between needs and desires
This is what most often causes waste.
Needs: food, shelter, transportation, bills.
Wants: hanging out, having snacks, buying new skincare, subscribing to Netflix.
Before buying, ask yourself: "If I don't buy this this week, will my life be a mess?" If the answer is no, hold off.
3. Cook for yourself and bring provisions
Eating out twice a day can cost you 1-2 million per month.
Cooking yourself can cut costs by up to 50%. Apart from being economical, it is also healthier.
Tips: Meal prep on Sundays for the next 3-4 days. So that there is no excuse for "being too lazy to cook".
4. Use the Cash Envelope Method
Withdraw cash according to budget per category. Example: pocket money 500 thousand, petrol money 300 thousand.
If the money in the envelope runs out, that means stop. This method makes you more conscious when spending money compared to swiping your card.
5. Take advantage of promotions and compare prices
Don't buy directly at the first store.
Check the marketplace first, compare 3 stores. Take advantage of vouchers, cashback and national shopping days.
For monthly needs such as soap, rice, buying wholesale is cheaper.
6. Cut Unused Subscription Expenses
Check your cellphone now. How many subscription applications are there? Netflix, Spotify, Canva, gym.
If you only use it twice in a month, it's better to stop first. Focus on what you really use.
7. Buy quality goods once, not cheap often
Buy sandals for 50 thousand but they break in 2 months = more expensive.
It's better to buy 200 thousand sandals that last 1 year. The concept is the same for clothes, electronics, and furniture.
8. Avoid Pushy "Lifestyles."
Go along with buying a new iPhone, hanging out in expensive cafes every day, or updating your outfit for the sake of content.
Focus on your financial goals first. Do you want to have an emergency fund, house down payment, or business capital. Prestige is expensive.
9. Look for Additional Income
Minimizing expenses has its limits. After that, the best way is to increase income.
It could be from online sales, freelance, or selling skills. That way the pressure on expenses will be smaller.
10. Set aside savings at the beginning, not at the end
The principle: Salary comes in - Save first - Then shop.
Direct auto-debit to your savings account every payday. If you wait for "leftovers", there usually won't be any leftovers.
Common Mistakes That Make You Fail to Save Money
1. Have no goals. Saving without a goal is easy to give up.
2. Use paylater for consumptive matters. Interest and installments increase expenses.
3. Don't have an emergency fund. Finally, if something suddenly happens, you run into debt.
Conclusion
Minimizing expenses is key in 3 things: being aware, taking notes, and being disciplined.
You don't have to live in poverty. Just reduce the things that are not necessary, and switch to things that build the future.
Start from 1 method first. Example: record expenses for 30 days. Once you get used to it, then add another method.
What expenses do you leak most often? Snacks, subscriptions or shopping? Tell the story below so we can find a solution together 👇
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How to Minimize Expenditures to Make Your Finances Safer
No matter how much income you have, if you don't control your expenses it will quickly run out. Minimizing expenses does not mean... See more
No matter how much income you have, if you don't control your expenses it will quickly run out. Minimizing expenses does not mean... See more
