Last updated in June 2020
Save money from your salary and maximise your savings. Saving money can be difficult when you have a limited income. Often, people run out of money shortly after payday. Or they struggle to stretch their money till the next month.
But saving money does not have to be difficult. With a few simple tricks, you will find yourself with money to spare at the end of the month. Saving consistently requires you to build good habits that you can start with today.
Table of Contents
How to save money from your salary
Divide your payslip
The best way to save money depends on you and your circumstances. Some people find it easier to save money weekly. Others may prefer to save money monthly. This also depends on how frequently you are paid.
- If you are paid weekly, multiply your salary by 4.5 if you want to save monthly.
- If you are paid monthly, divide your salary by 4.5 if you want to save weekly.
Of course, the easiest way is to budget according to your payment frequency.
Work out how much you can save
Before you can start saving money, it is important to find out how much you actually need to live. My free Never be Broke Again workbook can help you with this. Simply sign-up for my newsletter below and you will get access to your free copy.
My workbook will help you work out your total income, total expenses, and the amount you can save each month. Of course, you can always reduce your monthly expenses to save more.
Transfer your savings immediately
People often look at their accounts and overestimate how long their payslip will last them. It is easy to blow your money during a night out or at the shopping mall. You can avoid these scenarios by immediately transferring your savings to a savings account.
Another good idea is to open a separate current account for spending money. Then, when you get paid, you can immediately transfer the money you want to spend on entertainment and fun things to this account. This way, you always know how much you can spend and how much you have left.
However, this method can be a double-edged sword. If separating your spending and saving money results in you getting into your overdraft, you end up making the situation worse. Equally, if you resort to credit cards to top up your spending money, you are losing more than you gain.
This is why separating your money does not work for everyone. If it is not for you, do not worry though. Everyone is different and there is bound to be a way that works for you.
Automate your savings to save money from your salary
Transferring your money to your savings account or your spending account can be bothersome. Chances are you will be very enthusiastic at month one, okay with it at month three, and too lazy to bother at month six.
Some people may last longer than others but in the end, nobody has time to manually transfer money every month. For this reason, you should automate the savings process. If you know how much you can save every month or every week, you can set up a standing order.
Working out the exact amount you can transfer may take a while. The best approach is to start with a small amount and work your way upwards every month until you find that you cannot save anymore. Overall, the amount you can save will depend on man factors and is likely to change over time.
As your savings amount depends on a variety of factors, you should review the amount you can save at least annually.
Look beyond your payslip
People are often fixated on their payslip. They forget that there is a whole world of money-making opportunities out there. If you are finding it difficult to save money from your salary, you can look for alternative ways to make money.
Save money from your salary summary
Learning how to save money from your salary is not as difficult as it may seem at first. There are a few easy approaches, including:
- Divide your payslip
- Work out how much you can save
- Transfer your savings immediately
- Automate your savings
- Look beyond your payslip
The key point in saving money from your salary is to follow through with your intention and take action. Nothing will happen unless you act. Even if you have to try different methods and fail initially, if you continue to try to save money, you are likely to succeed eventually.
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