Moving out can be tough. First, you do not know the brutality of the world since you have always been protected by your parents. And second, suddenly, everyone starts expecting something from you. The carefree teenager now has a home to look after, a boss to keep happy and a bank balance to maintain. While home and boss can wait, one thing that cannot wait is the money.
Right from the first day, you need to develop habits that will help you have a decent amount of cash in the days of crunch or when the shopping bills suddenly inflate. If you do not take action right away, you can end up in a bad financial situation and end up ruining a well settled life.
This brings us to a few hacks that can help you survive with the minimum cash and save something for the rainy day at the same time. Let’s start!
1. Start with a Budget
Every good financial plan starts with a budget. A budget is a financial road map that will help you understand your liabilities and your freedom. Create a budget right on the day you get your salary and for the rest of the month, just stick to it. You might be tempted to buy the latest PlayStation or be with the group of friends that chill out at the pubs every other day but if your frugal living budget cannot afford it, you should probably postpone until you have started earning enough.
2. Money Saved is Money Earned
Sadly, most of us do not realize the importance of having savings. These are the resources that can save you on a bad day and if you are not planning your cushion, you are probably digging a pit for yourself. Put a part of your earnings into your savings account. Automate it if possible and allowed by your bank. Make it a habit and one day you will thank yourself for being smart. In a developing nation, having a savings is more important than in a developed nation. The job markets are not stable and the external forces (like business policies) are way too uncontrollable.
3. Set Up Ways to Get Emergency Funds
Even after living frugally and saving a decent sum of money, you will not always have enough to fulfil every need. There will be days when you will realize that you can use a little extra help from someone else. This is where the financial institutions come into the picture. Know your options while you are living a comfortable life so you don’t go have to run behind bank employees when you have a bad spell.
4. Learn to Save on Stuff
Living alone comes with its own share of freedom and duties. While you can stay out for as long as you want without anyone giving you THE looks, you have to take care of things like groceries. Frugal living involves saving on everything you can and as much as you can. Thanks to the technology entering the consumer markets, there are several ways you can save on the shopping bills. First, opt for payment methods that either give discounts or give you a cashback. Enrol in the rewards program and make use of your hard-earned points wherever you can. One of the life saving tip is to create a shopping list if everything you ‘need’, prioritize it and go by the budget.
5. Learn to Invest
You can opt for Government Treasury Bills and Funds which are hundred percent safe or you can go for the riskier but higher profit yielding stocks and shares. However, keep in mind that the latter requires a lot of study and research. Either use some part of your savings and fuel your investment plans or make a separate provision in your budget for these investments. Either way, this is one way that can help you build wealth over time and skip getting loans small loans from family and friends.
6. Ditch Plastic Money
Hard cash has a certain emotion attached to it. This is why when you pay the bills in cash, you feel disheartened and sad. Credit cards and Debit cards give you the freedom to live guilt free and this is exactly where you lose all the feelings that are attached with the money. Since you are now following a frugal lifestyle, it is the right time to stop carrying your cards and focus on using cash. You will soon realize the importance and emotions attached with the hard-earned money.
7. Pay Your Bills on Time
Your parents have been worrying about clearing your dues on time all these years. Now, it’s time to track and manage them yourself. Like financial institutions of other countries, your country too maintains a credit rating of its citizens. When you miss a payment or do not pay at all, you invite a negative remark on your credit rating. While you are young, this might not sound like a serious problem but once you grow old and need a loan to buy a home (sweet home) for your beloved family, you will realize that you need a good credit rating to get the money from the banks. Thus, pay all your dues on time.
8. Keep A Check on Your Accounts
World with all its high internet life faces several cyber threats from hackers and notorious online trolls. This is why it is important to keep an eye on all your accounts. Beginning from your credit card statements to the phone bills, check everything thoroughly every once a week. This might sound too much of a work but when you are living frugal, every penny counts. Financially, you already have enough things to worry about, you do not need a hacker stealing your credit card details or a cheat taking credit in your name from a moneylender. You are aiming for a simple life and if that means keeping your ears and eyes open 24×7, then what other option do you have?
