When December is now over, many people take out their pen and paper and start writing down a long list of New Year's resolutions: One of the more common goals is "save money" and even though you mean well, saving usually stagnates the following month.
Think about what is used
Many people spend a large part of their monthly income on communication and entertainment. This means that you pay for cable or satellite TV, mobile phone bills and the Internet. But the bills can be significantly reduced by cutting out what has not been used.
Reducing TV costs is in many ways easy today. TV often costs twice as much as a monthly mobile bill. Do not put more on TV channels than necessary now that there are options such as Netflix, Viaplay, etc. on the internet.
When we talk about the internet, what do you need for speed? There is a big difference between 30mbit and 100mbit, but when / why do you need a faster internet? There are big price differences depending on which supplier and speed you choose - think about whether you really need the speed you have today.
Choose the right savings account
Be picky when choosing where you want your savings. There is a big difference from account to account and bank to bank - it is important that you examine all the options you have.
Think about things like monthly / annual fees and what it costs to make withdrawals or if you have to commit to a better interest rate.
Even if the interest rate feels minimal in the beginning, it builds up quickly and every krona counts when you save for a specific goal.
What are your debts?
The first thing you should do before you start saving seriously is to first form an opinion about your current debts. It is more worthwhile to pay off a loan and avoid the interest from that loan than to put money in an account - you win on it in the long run! Be sure to pay off the debts with the highest interest rate first for that very reason.
Something that many with multiple debts do not think about is to gather all the loans together. Do you pay 3-4 places at the same time every month? Go to your bank and collect everything in one and the interest rate will go down significantly.
Start buffer saving
Your savings goal may be for larger purchases - investment for a house or a car - but you should not touch your buffer until it is actually urgent. It is important that you have money to fall back on if you e.g. lose their job or end up in hospital.
Usually you want enough to be able to manage three to six months without income - Start small and increase.
Keep track of your expenses every month
Start counting your monthly expenses, for one month count every penny you spend on expenses. It is extremely important that you find out where your money is going and what you can cut back on.
.. and set budget
When you know how much you are spending, it is important to set a realistic budget. It can be difficult to create a budget, but it is important to test what works best for your lifestyle.
Shop smarter
When shopping, shop smarter. Check what there are alternatives to everything you buy - brands, points system, shop in bulk, etc.
Most grocery stores offer different point systems depending on what and how much you shop - it's worth checking out what's locally near you.
Take advantage of the internet
Everything you buy can be compared on the internet. Are you going to buy a new TV? Check if you can order it directly from the warehouse for a much smaller price or if the store next door might offer an equivalent TV fixed for an incredibly much better price.
Reduce electricity costs
For many, the electricity bill is a good point to start reducing costs, especially if the electricity is used for heating. Fortunately, you do not have to live in the dark or freeze to cut the invoice by up to 20-30%. It can mean thousands of dollars over the course of a year, money that can be used for something else.
Heating of the home
The savings are greatest for electric heating (or air conditioning). An average electric wall stove consumes 1500 watts or 1.5 kilowatts (kW). In households that are heated or cooled by electricity, heat accounts for almost half of the total electricity consumption. The second largest share is water heating, about 14%.
Lowering the temperature in the home is a safe and simple method that makes it easy to reduce electricity. Most water heaters are several degrees higher than necessary to constantly keep the scalding temperature in the water tank.
It is a way to provide hot water as quickly as possible. But of course you can wait a few extra seconds at the sink and lower the temperature a few degrees. It also makes the house safer, as the highest water temperature is then at a fireproof level.
It is just as easy to reduce electricity for heating (or cooling), and you do not have to suffer through the measure.
When are you home?
In most homes, there are several rooms that are rarely used during the day, and others that are not used at night. At night, the home office, living room, kitchen, and (if you have) laundry room are typically empty.
Lower the thermostat for these to about 10 C in the winter. It takes less electricity to heat them in the morning than to keep them heated all night. If you have a programmable thermostat, you can set it to automatic start half an hour before you get up. That way you never notice the difference.
Closed bedroom doors insulate. Keep them closed (or almost) at night. It prevents the heat from the bedroom from leaking out, and vice versa during the day. Keep laundry and extra bedrooms closed at all times except for the short periods they are in use.
The same applies to air conditioning for cooling or heating. If you use air conditioning, you can close the wiring to rooms when not in use.
Of course, one should make sure that the home is well insulated - a must for long-term savings. But replacing insulation or improving it is expensive and the profits accumulate over the years. In the short term, it gives greater savings to look at things you can control right now.
Keep track of your goal and reward yourself when you reach it
It is important to keep track of savings every month - are you ahead, exactly or after the goal? Go through it at least once a month and see what and if you need to improve it.
Once you reach the goal, celebrate and reward yourself with something - it is important to save but it is not about totally overlooking pleasures. Good luck!
Bonus: Save money on entertainment
"Entertainment" is a broad word. It can mean going to the movies, having dinner, watching a sporting event, and more. In the reach lies the secret to lowering the cost of an important part of the good life.
Movies
For example, movies that may be your passion. There are many different ways today to watch movies for almost nothing. You can sign up for a web subscription for a few tens per month and watch two movies a week or more. You can watch many for free on high bandwidth computers. Save gas and time by skipping theater, and making your own popcorn at home.
If you have to go to the cinema, it is good to skip all the hyper-expensive sweets and soft drinks. And use discount cards for cinema.
Meals
Food is a great pleasure and everyone loves to go to a nice restaurant and eat royally. But there are alternatives at much lower prices. Good restaurants are defined not only by good food (but it is important) but by good service. Ask friends where they have received good service in middle class places. Try that place.
If you want to save a lot in the area, you can cook dinners at home - but with wonderful differences from a normal everyday meal. Invite some friends and ask them to bring dessert, wine, and a special dish. Fix cozy lighting and think through serving and dish based on exotic recipes. It gives a good atmosphere and a sense of adventure that turns the dinner among friends into a lavish evening with gourmet food.
Sports and events
Tired of sitting at home and watching TV sports? Do you feel like going out and watching people? There are lots of ways to do that and still save money.
Many bars have large, high-resolution screens for football, ice hockey and the Olympics. No matter what sport you like, there is a bar with the right "menu", at least on selected days. Use your online social network to coordinate with whom you want to turn an ordinary day into a tennis event.
Be creative and look for unusual circumstances and arrangements. It provides a good opportunity for cheap entertainment.
Can also warmly recommend my friend at SparaCash who gives several good tips and tricks on how to get started with your savings.
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