How to 'save before you spend'?
Increasing prices have made saving even more difficult than before. In times like these, we have to reduce spending and save as much as we can. One way to do that is by applying the 'save before you spend' technique.
It simply means to put away your savings amount (ideally 20% of your monthly income) at the start of the month. Here are four tips to help you do that:
1. Save automatically - Decide on the amount you want to save every month. When you get your monthly salary, immediately transfer that amount to another account and do not access that account unless needed. - Now you can easily do that with online/mobile banking. Some banks also offer a ‘scheduled transfer’ option which automatically transfers money for you every month. 2. Set up a savings account (Islamic or Commercial)
- Having a savings account allows money to grow. If money is left in your current account it will lose value over time due to inflation as we have all seen these last few months. - All banks (Islamic and commercial) in Pakistan offer a savings account option with an average yearly return of 4-8%. 3. Put your change towards a goal - So many times our wallets are heavy with change or ‘khula’ but by the end of the day, it's all gone. Spare change is a big-spending leak. Now start putting it in a change box / ‘gulluk’ and only open it at the end of the month. Try this method and share your story with Oraan :) - Another option is to track and save towards a particular goal. For example, building an emergency fund. Remember saving as small as Rs 30 every day can result in almost Rs 11,000 in savings by the end of the year. We at Oraan have made goals tracker to help you track your daily savings.
4. Save with a group Take part in a committee, that way you will be forced to save a small amount every month and you will get your savings when you need them. You can join an Oraan committee to save with a group. Follow these tips and start saving today!