Saving money can be tough. Whether you support your loved ones and send money to the Philippines regularly, or are simply living on your own for the first time, all those extra responsibilities definitely pile up. 

However, with some good advice, you can set some funds aside and still treat yourself every now and then. Check out these ways to save more and reach your financial goals without cutting out the things you love!

Set Clear Financial Goals

Be clear about what you want to achieve. Using the SMART framework to write out your goals will make them clear and actionable.

SMART stands for Specific, Measureable, Attainable, Realistic, and Timebound. A SMART financial goal answers these questions:

• What do you want to save for?
• How much do you want to save? 
• Based on your circumstances, is it possible to meet this goal?
• Is this goal important to you?
• When will you meet the goal?

Suppose someone would like to grow their emergency fund by $3,000 by the end of this year. If we write that out using the SMART framework, the goal would look something like this:

• I want to increase my emergency fund by saving $3,000.
• I can do this if I reallocate $250 from my monthly shopping budget towards my emergency fund.
• I want to have three more months’ worth of expenses saved in 12 months.

The framework is easy to apply to your own goals. Try it and see if it motivates you to stay on track!

Put More Thought into Your Budget

You can't achieve your goals without a plan. This is what your budget is for—to keep you on track to meet your financial goals while you cover your responsibilities.

Look back on your 2021 spending and create a 2022 budget based on your habits. Here are some rules of thumb to consider: 

• If you consistently overspent in one area, that might mean you hadn't budgeted enough for that expense. Revisit your allocation.
• If you consistently underspent in one area, you may want to reallocate funds to other categories.
• If your spending was within budget, it means that your strategy worked well. It may be good to retain this scheme for the new year, but give yourself some wiggle room for unplanned expenses or changes in the budget. 

No matter which tips and tricks you use to save, they will only work if you have a clear and actionable financial plan in place. Don't skimp on time to plan your financial goals and budget!

Start with Savings

You’ve probably heard the phrase “pay yourself first.” All this means is setting savings aside before you allocate money towards expenses. If you follow this principle, you’ll have a fixed amount of savings every month without having to dip into your allocation for other items. Here’s an example of how you can prioritize your budget:

1. Emergency Fund. This is meant to keep you afloat in case of medical emergencies, job loss, and other unforeseen expenses. Many experts recommend having 3-12 months’ worth of essential expenses saved.
2. Essential Expenses. This fund covers regular expenses including rent, utilities, groceries, debt repayment, and maintenance medicines if any.
3. Goal-oriented Savings. This is meant to cover your big savings goals, like getting a new gadget, going on a trip, or buying a new house.
4. Lifestyle Fund. This is a flexible fund that covers your “wants.” You can use it for things like eating out, salon appointments, shopping, and entertainment subscriptions.

Don't Mix Your Money

Separating your savings from spending money, and spending categories from each other can lessen the temptation to go over budget in any area. You can set up a dedicated account for each of the budget categories we mentioned earlier:

Map Out Spending Seasons

Between gifts and hosting parties, holiday spending can take a big chunk out of your wallet each year. But if you map out and save ahead for these expenses, they don't have to wreck your monthly budget! Here's how you can manage your occasion-based spending:

1. Take note of all spending-heavy events that you anticipate for the year: birthdays, back-to-school, Black Friday, Christmas, and others.
2. Allocate a category in your budget for occasion-based spending.
3. Starting in January, save a portion of every paycheck for this purpose. Use a spreadsheet or budgeting app to track your contributions.
4. Use the funds in this account to cover all your occasion-based spending. 

Contribute a little more than you think you’ll need to this fund so that you don't have to dip into other accounts when your events come around.

Lock Extra Funds Away

Got a bonus at work or a surprise cash gift? Put it straight into your savings! Try these tips to grow your savings a little at a time:

• Round off. At the start of every month, round off your spending account balance to the nearest $10 dollars and store the rest. For example: if you had $1,365.30 in your balance, you would put $5.30 of that into savings.
• Save every $20 bill.  Pick a bill denomination. Then, whenever you receive that bill, put it into your savings.
• Try a no-spend week. For one week a month, limit your spending to essentials only. Try to stay in, cook your favorite meals, and focus on offline hobbies during this period.

‍

Cut Recurring Costs

There are some things that you’ll be spending on regularly: for example, your utility bills, or any online subscriptions you’re interested in maintaining. There are plenty of ways to save money on recurring expenses.

• Go on a subscription cleanse. Go over your bank statement and cancel any entertainment or delivery subscriptions you haven't touched in 6 months.
• Say no to convenience deliveries. Enjoy shopping online? Avoid express deliveries for an extra cost if you have some time to wait.
• Beat your last utility bill. Every month, challenge yourself to beat last month's bills. You can try reducing the use of energy-intensive appliances (like your air conditioner/heater, television, clothes dryer) or installing more energy-efficient ones to lower costs over time.
• Find better deals on essential services. Do you send money to the Philippines often? You can use services like BayaniPay to send zero-fee remittances with high exchange rates. Take advantage of deals like this on services you use regularly.

Reward Yourself For Every Milestone

It takes a lot of discipline to save consistently. Reward yourself for your hard work! Set up savings milestones and allocate some money for a treat when you reach each tier.

Our Two Cents

Everyone will have a different experience of saving money. Don't compare your journey to anyone else's! Instead, celebrate your achievements and be grateful for every dollar you earn.