You know that feeling, when your paycheck comes in every month, like you can take on the world? You feel rich and make a promise that this month, you will be better with your finances. This month, things will be different. This month, you will track your finances using a cool app that your friend recommended.
Fast forward five days later and your account balance is RM -286.00. Your eyes almost fall out of their sockets when you check your bank balance. Where did the money go?
If you’re constantly struggling to make ends meet every month, or just don’t know where your money is going, you’re not alone. It’s really hard to draw a line between your wants and needs, and your needs hardly ever come to an end. After all, we only live once, right? Yes, but we don’t want to be engulfed in debt and regret every month.
If you’re looking to turn things around, great news, we have some ideas on how you can be a little less broke from now on. You will have to put in a bit of work and practice tightening your purse strings – and hopefully, you won’t see a negative bank balance at the end of the month anymore.
Follow the 50-30-20 rule
This is the easiest way to manage your cash flow every month. Whenever your pay is in, immediately put them into three parts.
Stash 20% of your salary into another bank account and forget about it, just like how you conveniently forgot that you already own three pairs of black shoes. These savings will add up and eventually help you to settle some personal debts like student loans, or emergency needs, such as car repair. If you think you have no self control and will eventually dip into your savings to book an Airbnb for your friend’s birthday the following weekend, then consider putting it into a fixed deposit account.
Next, put 50% of your salary aside for mandatory expenses. This will cover rent, utilities, healthcare, groceries, and transportation. If you have children, this should also cover their costs as well.
The remaining 30% of your salary will go for things you can’t live without – so phone bills, internet bills, paid TV, dining out, movies, shopping and so on. You can also allocate some money from this 30% to reward yourself with a year-end holiday or to treat yourself once in a while.
Korken jar your money
Love spending your weekends in IKEA? Awesome. The next time you’re there, buy a few IKEA Korken jars. Alternatively, you can also order them online from Lazada and get them delivered right to your doorstep. Actually, any type of container will do.
Basically, this is for the money you have left after you’ve settled your mandatory payments like rent, bills and utilities and have set your savings aside. Take this chunk of cash and divide it into five parts: food, groceries, entertainment, transportation, and miscellaneous.
Every week, you are allowed to take out just what you think you need for seven days – and try your best to make it last. You’re only allowed near the jar again after seven days. You’re also not allowed to top up the jar. Let’s say you allocate RM200 this month for shopping, but by the end of the second week, you’ve used it all up. That means you have to wait until your next paycheck before you can shop again.
Take advantage of banking offers
This is the best way to save money and to divide and conquer your finances. Having multiple bank accounts does not only make it easier to manage your cash flow, but it also makes you eligible for multiple perks and rewards offered by different banks.
Bank A offers points and rewards for paying bills with an online account? Use that to settle your mandatory expenses. Bank B offers great fixed deposit rates? Use that for your savings. Bank C has great cashback rates on their credit cards? Use that to pay for your daily expenses.
Having multiple bank accounts also work great if you have multiple financial goals so you can allocate different amounts of money for different goals.
Take pride in being cheap
It may not seem like it, but you’re not the only one struggling to make ends meet every month. Chances are that most of your colleagues are also either struggling to pay their bills and are silently suffering – or they are maxing out their credit cards and paying the bare minimum every month.
So the next time you guys are going out for lunch, don’t be afraid to suggest a cheap place to eat. Cheap doesn’t always mean bad, and expensive doesn’t always mean good. It’s all the value you get for the money you pay.
There are plenty of food review blogs available online, so all you have to do is Google ‘cheapest places to eat in KL/PJ/Penang/JB’ or wherever you are, and there you have it. Be that friend who knows all the cheap and good places in town! (Psst! You can also use apps like Zomato.)
Take advantage of happy hours
Who said you have to sacrifice going out for drinks after work just because you’re on a budget? Alcohol in Malaysia can be very expensive because of the taxes.
But if you know where to go, you can get save yourself a lot of money while still enjoying your Friday and Saturday nights out.
Make the most out of your credit card
Credit cards are not the root of all evil – they are angels in disguise. Aside from allowing you access to better cash flow management through features like 0% instalment plans, credit cards also offer a whole range of exciting, money-saving deals.
Some credit cards offer great discounts on movie tickets, and cashback on dining, groceries, petrol, and even Grab rides. Find out which card best suits your lifestyle and reap the benefits!
Never buy anything immediately
This is a timeless trick that works every time – if you practise it. Whenever you see something you like, don’t buy it immediately. Go home and go about your daily routine; see if it’s still on your mind. Sleep on it and see if it appears in your dreams.
If you’re still thinking about it after a week, then go ahead and buy it. But if your desire has waned, then you have successfully saved yourself a whole lot of money that would have been wasted on something you didn’t really want in the first place.
Now that you are well-equipped with these money managing hacks, hopefully you’ll see a positive change in your bank account starting this month. If you have any other tried-and-tested money hacks, do share it with us in the comments below!
Read More: How To Stop Overspending On Weekends