Ever find yourself overspending every month? To be honest, I always find myself overspending (maybe it’s because I’m a Piscean).
I’ve been working for more than 2 years now and I basically have limited savings. I tend to buy a lot of stuff (gadgets, clothes, books, games) without even looking at the price. Ah….the wonder of credit cards.
However, without money, there are a lot of things which you can’t possibly do. You can’t start your own business. You can’t help those in needs. You can’t even save yourself if there’s an emergency. That is why, it is always important to have a bit of money in your bank (be it Fixed Deposit, savings acco
unt, funds, etc).
For myself, I’ve started to save a small portion of my salary since 5 months ago. That was when I came across the book “The richest man in Babylon” by George S. Clason. The book has a very simple concept of managing your finance. Let’s summarize it this way….
- Every month, save 10% of your salary (something to begin with. You can save more if you’re comfortable).
- This is a MUST. Save the 10% no matter what. Make this a habit and don’t give excuses to yourself if you can’t save. 10% is not really a big amount. Cut down on your food and your “Nice to have” items to accommodate this 10%.
- You’ll eventually see your savings grow….but since savings account does not provide you high interest rate, feel free to get the money out and put into things like Fixed Deposit, or trust funds. Let the money grow…. but do proper research before you commit to something.
That’s it. Simple right? I do highly recommend the book to all of you out there. 
Hope it helps.
4 comments
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December 28, 2006 at 9:59 pm
Farhan
Overpsending is a very serious problem! If you don’t keep a check on your spending habits, things get a bit out of hand. I had a Nokia cellphone with spreadsheets capabilities in to help me keep a track of my spent money. By the end of each month I felt very uneasy because I thought I was spending too much. So I cut down on a few things, like my regular dose of cheeseburgers, shopping for sports accessories and wasting money on repairing my old electronics. I realized then that it wasn’t a very good idea to write all your expenses down on a spreadsheet, because that can make your life miserable!
So to solve the problem I joined a company which sets aside that little 10% for me
Now I don’t have to worry about doing all the calculations and keeping records, and can spend my base salary whereever I want to.
Sometimes you need a little ‘external pressure’ to keep you from getting out of control. Self organization is also important, but it shouldn’t keep you from having fun!
December 28, 2006 at 10:14 pm
Alvin
Whoa, I didn’t realize there are companies which provide that kind of option – force the employees to save 10% of the income.
It’s a good practice nevertheless. From there onwards, you can use that saved 10% on other investments …. and sooner or later, you’ll be quite a rich person.
April 14, 2007 at 9:15 pm
Angie Tan
Hahaha…
OK, this comment is overdue.
Anyway, I remembered one of those small adverts on the radio and it got me thinking about saving.
The ad said something to the extent that besides paying for the bills and etc, remember to pay yourself by saving a portion of your salary away.
April 14, 2007 at 10:14 pm
Alvin
yea, you’re absolutely right. maybe i shouldn’t have bought the LCD ?