Saving money can help you retire at a young age or build your dream home, and most importantly, it can help you get money when you need it and help you with your savings when you are in financial difficulty.
In this report, published by Australian Reader's Digest, a number of millionaires provide important advice for getting the best out of it.
Put the credit card aside
The owner of Dallas Mavericks basketball club, Mark Cuban, says that credit cards can ruin even the best savers. “Credit cards are the worst investment you can make. The money I save on interest thanks to no debt is better than Any return I can get by investing that money in the stock market. "
Credit cards can push you to spend more money, and in a study published in the journal Marketing Latters, researchers found that shoppers spend up to 100% more when paying with a credit card.
Track your progress
It can boost tracking of your progress and holding you accountable while saving money. Microsoft founder Bill Gates is reported to have shared this advice in his 2013 annual letter to the Bill and Melinda Gates Foundation. “Last year, I was shocked. Time and time again, with just how important metrics are in improving the human condition, you can make amazing progress if you set a clear goal and find a metric that drives progress toward that goal.
And this is whether you are using a budget app or a simple paper list, as tracking your savings can get you closer to the amount you want to keep for the future.
Live simply
Warren Buffett is among the richest men in the world, but he still uses a foldable phone and lives in the house he bought in 1957 for $ 31,500, and likewise, T-Bone Pickens, a tycoon of the oil industry, fills his wardrobe with just the basics. Pickens "People are always surprised that I don't have a closet full of suits. I buy three suits almost every five years, and I only have ten, that's all I need."
Diversify sources of income
A five-year study of self-made wealthy revealed that most of them have multiple sources of income, ranging from real estate rents to stock market investments and side businesses. The more income you can make in life, the more secure your financial situation.
Automate your savings
Millionaire Ryan Stewman says his first saving trick is to automatically withdraw money from his salary and put it in a savings account, so you won't even notice the money disappearing, and as your savings grow, you can use it to invest in stocks or make an additional payment on a mortgage or other loans.
Rule (50-30-20)
The CEO of The Penny Hoarder, Kyle Taylor, has made millions in a matter of years thanks to the rule of "50% -30% -20%", whereby the monthly salary is divided as soon as it is received into three parts, the first part is Allocating 50% of the salary to fixed basic expenses, such as housing rent, electricity and water bills, and education expenses, and 30% of the salary is allocated to variable expenses, or luxuries such as shopping, leisure activities, trips and gifts, and finally 20% of the salary to be allocated to future financial plans such as increasing savings Or expediting debt repayment, as well as following an investment and savings plan for emergencies.
Avoid spending on desires
Wealth creation expert Tom Corley recommends avoiding spending on desires, as he explains that many people are spending more money than they earn on desires that include eating out, buying an expensive car or taking a vacation.
Don't lend money
Your love for your family and friends should not be measured by your generosity, if you do not lend them money, you may create problems between you and them, and if you lend them money, you may never get your money back and you will find yourself upset with them, and then you will lose your friends and your money in both cases.
And if it is necessary to lend money to someone close to you and dear to you, make sure that the loan is not open.
Be a smart tuner
In his study on the habits of the rich, Corley came up with specific strategies that can help you spend smart, and the best way to buy is to buy in large quantities, as buying in bulk can save you money, especially since it has been proven that toilet paper, soap, laundry detergent, paper towels and shampoo are sold. Much cheaper when you buy them in larger quantities.
It is also recommended to develop a food plan, by setting a weekly menu that uses similar ingredients in order to save money and avoid food waste.
Avoid a life of extravagance
Self-made millionaires avoid raising their standard of living to match their increasing income, and when you feel like spending money, Corley recommends allocating the money you earn to savings and investments that grow in value and that provide financial resources that you can use in the future to maintain your standard of living.
Be frugal but don't buy the cheap
You should not buy the cheapest products or get the cheapest services to save money, as these products malfunction in a short period compared to quality products, and those who provide cheap services are usually inexperienced or inexperienced in what they do, and they will make you in trouble. .