If you are always running out of money by the end of every month, leaving nothing for savings, you need to spend less. But that is not so simple as it sounds as most of us have found out the hard way. How much you spend actually depends on a lot of factors, most of which are in the mind. How much you spend or save is also a matter of habit. By doing the following things, you can trick your mind into spending less.
Wait before you make a purchase: When you fancy a purchase like an expensive gadget or a designer watch, do not shop for it immediately. Remember that when you purchase something, the initial euphoria will be high, but it may not excite you that much a while later. Instead, give it some time, a week or so. Once you have thought through it and still decide to go ahead with the purchase, it is ok. But it many cases this will make your think hard before making an impulsive purchase.
Spend your money on what matters to you: This sounds like a given, but you should spend money on what really matters to you. If you go out for a run every day, spending on a pair of expensive running shoes is entirely worth it. But if let us say, if you hardly wear formal shoes, there is no point in spending too much on a pair.
Before spending money on anything, think about whether the price you are paying actually makes sense. More than the amount you are paying for something, it is the utility that matters. Even Rs 200 a month for a streaming app that hardly watch is money wasted. Taking this approach will help you not spend on things that you would not use.
Reduce use of your credit card: This sounds kind of simplistic, but it really works. Stop carrying your credit card around. Do not keep it saved as payment methods on online shopping websites. Try to spend more through cash or debit card. The human mind is such that it tends to make more purchases when one knows that there is a free interest period . But credit card bills need to be paid every month and not paying them can lead to a lot of problems. If you want to spend on your credit card and accumulate reward points, make sure you pay the same amount to the credit card company as soon as you make a purchase. This is the same as paying with a debit card and you will not run up huge credit card bills you cannot pay.
Automate your savings: The good news is that you cannot spend money you do not have. If you automate savings every month, where a part of your salary goes into SIP investments directly from your account, you will end up spending less and saving more. Never put off your investments till the end of the month, as that way you will end up spending more money.
By making some small changes, you can end up saving more and having a better control on your finances. After all, it is never too late to start.