Hey, I'm Save!

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Blogger - Savebly

 

Find out what you spend the money on
The first thing is to know how much you spend and how much you enter , right?

Personally, I help myself with the Fintonic application to monitor income and expenses. This way you will know how to adjust the monthly budget (eg cut expenses on eating out).

Fintonic helps you know how to save money by calculating all your income and expenses

Follow the steps below to find out how much you spend and how much you save per month:

Download, install and open the Fintonic app for Android or iOS .
Create an account with your email and password.
Select and connect your bank accounts (eg Bankinter , Bankia or EVO ).
Complete your profile information (sex, date of birth, zip code, etc.).
Now select what type of notifications you want to receive .
Confirm the email and add an extra security pin - optional.
Review all your movements and categorize those that Fintonic has not correctly labeled (in the movements section).
In the expenses section, add what you want to spend per month in each category (as planned).
When you receive a new expense or income , make sure it is in the appropriate category .
Other similar alternatives are: Monefy, Mint or Wallet . Or if you don't trust using an app (eg privacy issues), you can set up a spreadsheet - keep in mind that this will require much more manual work.

2. Define your budget with the 50/30/20 technique
Experts seem to point out that between 20% and 35% of your salary should be used for savings. But of course, this is a very generic statement and may not be suitable for your case .

I like the 50/30/20 technique more to create the budget. Basically it tells us that we should approximately dedicate:

50% of our income to basic needs (not avoidable) such as mortgage or food.
30% goes to things you want (eg leisure, vacations, hobbies, etc.).
The remaining 20% ​​goes to savings.
Check out the following table with examples of the 50/30/20 rule for different incomes:

Rent (net monthly) Basic Needs
50% Non-basic expenses (eg leisure)
30%
20% savings
€ 900 € 450 € 270 € 180
€ 1400 € 700 € 420 € 280
€ 1800 € 900 € 540 € 360
€ 2200 € 1100 € 660 € 440
€ 2800 € 1400 € 840 € 560
€ 3200 € 1600 € 960 € 640
€ 3800 € 1900 € 1140 € 760
Once you have this estimate, you must adjust the items according to your case . For example, if your salary is very high, you still don't want to spend 30% of your rent on leisure and prefer to save 15% more. Or else, you cannot save 20% because you have very high fixed costs (eg rent).

Once you have decided how much you want (or can) save, you should analyze your expenses (previous point) and see where you can cut . The following tips can give you ideas on where to start:

3. Adjust the budget using envelopes
Adjust the budget with the help of envelopes

Nothing to charge in B or deferred, let me explain it to you ?

If you have trouble meeting your budget , you can help with envelopes to organize your expenses. The thing would work as follows:

Create a budget to adjust to - see previous point.
Assign envelopes for each category .
Distribute your money (eg salary) in the different envelopes - according to the budget.
Store envelopes with money in a safe place .
Take money from each envelope as you need it - eg for the purchase of food.
Note: This method can be a nuisance since it makes you have a little extra work every week and every month. In addition, you will have to have a lot of cash at home with the risk that this entails.

4. Savings automation
Once you have calculated your income and expenses and know how much you can save , you can make transfers to your savings account to accumulate what you have left over each month.

Income minus expenses calculated with Fintonic

After a couple of months, you'll know the minimum amount you can save. Simply, schedule automatic transfers with the money destined for savings at the beginning of each month, so you don't spend it.

Follow the next steps:

Calculate how much money you have left over a month and write it down on paper - help yourself with the first two points.
Check your account and check when you get paid normally (day of the month).
Add a recurring (and automatic) transfer from your checking account to your savings account in the amount of point # 1 for a couple of days after your salary is collected (point # 2).
If at the end of the month you still have money left over, make a new transfer to your savings account with the surplus, and increase the amount of point # 1 until you find the balance.
Repeat this process every month.
This way, you won't have the opportunity to spend your money on things you don't need .

Note: In my case, it is the strategy that has helped me the most to save - every month I transfer € 500 to one of my paid accounts or deposits , saving € 6,000 a year without finding out - for example with Raisin deposits .

Now that you have your savings plan in place, let's see how you can reduce expenses (or increase revenue) to increase the amount you save.

5. The 30 day rule
The 30-day rule to avoid spending and saving money

There are numerous studies that have determined that much of our purchases are impulsive - come on, unplanned purchases and that many times we don't need.

For example, one study found that Americans spend about US $ 5,400 on impulse purchases. And (among others) shoes, clothes and take-away food are the most popular.

To avoid this type of purchase, we can follow the 30-day rule, which consists of:

When you notice the urgency of buying new sports shoes, a new smartphone or even a pair of socks, stop for a moment and reflect .
After a few minutes, write down on a piece of paper (or a note on your phone) what you wanted to buy .
Put the paper in a visible place like in the hall of your house, or the desktop of your computer.
Use the next 30 days to reflect if you really need that product and if you are going to use it.
If after 30 days you decide to move on, buy the product without feeling bad.
Amount you can save : € 4,500 per year.

Note: Data from a US study and extrapolated to the Spanish market.

6. Repair, save money and save the planet
You open the closet, you are going to wear pants or a dress and you realize that the zipper is broken.

But do you need to throw it away and buy a new one?

For example, in the United Kingdom they have discovered that millions of products that could be repaired are thrown away ( source in English ).

Normally, repairing something ends up going cheaper than buying something new, despite what popular culture makes us believe. In addition, repair is much more beneficial to the environment .

This is my process to decide if I really have to get rid of something or it is more important to me to repair it:

Is it under warranty? Many times we do not take advantage of the 2 year warranty.
Could I repair it myself?
Compare the cost of repair vs. replace it.
What wear do you have? If it is something very old with much equal use it is better to change it.
If I replace it with something new, will I save on something? E.g. energy efficiency.
Will it be very difficult to repair?
Do I really have to replace it? E.g. If some pants were broken and I have 8 more, I still don't need new ones - back to the 30-day rule.

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