Want to save money but don’t know how to get started? Read on because this article will quickly guide you through money saving tips that will allow you to start saving and saving for whomever you want.
- Calculate your expenses – Calculate what the average month in your wallet looks like. You can use your online bank statement to do this, but it will be more accurate to figure out how much you spend on what – how much a month you go for coffee, food, rent, living, other daily expenses. Once you’ve made your calculations, group your expenses by category.
- Set a budget. In order not to be a shoe that doesn’t work, you have to budget for compulsory spending and try to include extraordinary expenses (like the Olympics broadcast) that you can still predict. This way, you will be clear about your financial priorities.
- Plan your savings. Every month you should be able to save between 10 and 15 percent of your income. If you can’t, you need to trim your spending.
- Plan who you are saving for. Is it really worth saving if you don’t know who to save? Do you want to save for your down payment? Save for emergencies (incidentally, it is usually recommended to save for three months without income)? For a new car?
- Consider investing. If you are saving in the long run, you may find it useful to make some investments. Banks offer mutual funds where you can invest with certain guarantees that you will not lose too much money in case of failure. This can be done even if you have no knowledge of investment processes. The value of money is only falling – only now is the time when oil prices and economic processes are reversing.
- Collect automatically. A monthly defined payment is a very useful thing if you want to save money. Set it up online and you will be able to sleep more peacefully.
How to reduce costs?
To reduce your expenses, start with the budget you have created. The most expensive positions in it can certainly be reduced somehow. For example, a mortgage can be refinanced if its interest rate is too high. Internet costs can be reduced, for example, by buying the internet in half. Save electricity by heating the water – and do exactly what you need – on the gas stove. But start with the biggest, regular expenses. It’s not worth worrying about turning off your computer overnight if you pay $ 200 more each month than your neighbor for the same apartment.
Is it possible to save at all in Latvia?
Living hand-to-mouth, it rarely seems possible to save money at all, spend less, stash for travel, make more purchases, take courses, live in another country. However, statistics show that many in Latvia still have the opportunity to save. The average salary in the country is $ 599 per month after tax (September 2015 data). The average salary in Riga is 850 dollars.
Can save quite a lot of money
A person with an average salary in Latvia can save quite a lot of money, as the optimal food expenses for a family of 4 people are around 300 dollars per month (more precisely – 312 dollars, according to Good Finance research), ie about 100-120 dollars per adult. But the rent in Riga is expensive – one-room apartment in the neighborhood can be found for 150-200 dollars per month. Adding a daily cost of $ 100 and another $ 50 to transportation costs, a $ 50 utility bill (on average) should keep a person with an average salary of $ 850 in Riga with about $ 330 in disposable income. The amount should be more than twice the cost of the family because of the sharing of housing and utilities, and in some cases transport costs. So even with an average salary in Riga you can certainly survive.