Saving the dolla dolla billz - Where to begin?I've been thinking about savings and where to begin. What's the best way to put money aside and what can I do today to start putting money away. So, I got a bit of help, Arvin shares with us an insight on where to begin.
Reduce credit debt
If you have any credit card debt at all, this is where you want to start working on. Let me explain. When you put your or take money in different environments ( savings, investment, your closet, loans, etc), it does not grow at the same rate. Let's say you just take your money and put it in a shoebox you have in your closet. It actually decreases in value due to inflation. So if you had $100 and assuming a 2% inflation, after a year you would only be able to use that money on things worth $98 in the year before. That's because things get more expensive every year. Today an apple might cost $1, next year it could be $1.02. It doesn't sound so bad but when you realize it happens every year and it affects everything then your fixed costs ( Rent, groceries, bills, etc) might be $10,000 a year, in 20 years it will cost you almost $15,000 a year. That’s a $5000 increase! Most credit cards have a 20% interest rate, which is even worse. A $10,000 credit card loan will cost you $300,000 in 20 years. So unless you can find a savings account or investment that can give you more than 20% return. Then I highly suggest starting with that. - Arvin Orena, Life insurance broker and personal finance advisor
Having said that, here are a few tips and tricks that we can do on the daily to start putting money away that can work for us.
1. No Spend Week Challenge.
Every week, challenge yourself to spend $0 on certain items. One week, I would spend $0 on eating out. Other weeks, we decide it's $0 on entertainment. That's not saying we don't do fun stuff, it just allows us to be more creative.
2. Change, Change, Change.
Every dollar counts. If you can collect as much change in a week and put them aside every month - that could go into your savings!
3. Start Small
Seeing the bigger picture helps but starting small allows you to start putting it to action. Start taking out $5/week and go from there.
If you haven't seen it yet, I share a free download and my app pick of the week that helps me with staying on track with the dolla dolla billz yo!
I hope that helps!