Category: Savings

The Best Strategies to Save For Long-Term Travel

The desire to travel for a long term remains a dream for many people. After working so hard for many months, a trip to the best destination in Wales, Queensland, Hawaii, or Greece among other places would give you a perfect opportunity to learn, explore, and reenergize. It is a perfect way to run away from the busy schedule and make life more fulfilling. However, such traveling is also very expensive. The best way to have assurance for such travel is saving for it. Here are some of the best strategies to save for long-term travel.

Figure out the total amount required for the travel

The first step is establishing the total amount that will be required when traveling to your preferred destination. At this point, you must research the destination comprehensively. Here are some important questions to answer during the research;

  • Where exactly will you be traveling to?
  • How long do you want to take on the destination?
  • What will you do when traveling?
  • How fast will you be traveling?
  • What is the nature of the hotel/accommodation you will be using?
  • What type of shopping will you do?

Save cash for traveling before spending it

Once you have deducted cash for all monthly bills, retirement, and emergency, the next thing should be setting aside some for long-term travel. This means that you will not disrupt the normal lifestyle (monthly requirements) because of the holiday. To make this saving even more realistic, consider automating the deduction for the holiday. Immediately your salary gets into the account, ask the bank to deduct the portion of the holiday and leave the rest for monthly use.

Draw a good financial plan to make saving realistic

While the main objective is to make long-term traveling a reality, you need to factor it into the bigger picture of personal financial planning. Well, no matter the focus you have on personal finances, failing to plan appropriately will only bring disappointments.  When it comes to saving for long-term travel, having a good financial plan will be beneficial in these additional ways;

  • You will cater for all the monthly expenses to avoid using the savings for a holiday.
  • All the emergencies will be well taken care of. If you select the insurance cover well, it might cover some considerations when on holiday.
  • A good plan includes methods of generating additional revenue. This is crucial in making your stay extra enjoyable, extending it, or even meeting investment demands.

Work harder between now and the time you leave for holiday

Working hard helps to generate extra revenue and to get all the tasks that can compromise your holiday cleared. Now that you have an objective of saving more, it is time to look for an extra job or work for extra hours to earn more. The additional cash can all be directed to saving for the holiday or divided between emergencies and holiday.

Working extra hard will not just work well for a holiday, rather, it will be a stepping stone to promotion, salary increment, or getting out of debt. If you can sustain the momentum after the holiday, this can be enough to reach financial freedom.

 

Simple Money Saving Tips to Help You Build Wealth Faster

Want to build wealth faster? The formula is very simple; save and spend less! While this is easy to say that implement, some of the richest people in the world have climbed to the top by applying it. In this post, we bring you simple money saving tips that will help to build wealth faster.

Automate the monthly saving

Automating your finances helps to make everything easy, faster and fun. By automating the finances, the money that goes to savings will always be remitted on time, and you will never skip a deduction. For example, you can ask your bank, HR or accounts department at work to remit a portion of the earning directly to the investment/ saving account. Automation helps you to save in the following two ways;

  • Because you do not even see the cash, there will be no temptation to redirect the cash.
  • Your budgeting will get used to the cash that remains in the account after saving has been remitted.

Create new sources of revenue and channel the cash to the saving account

Many are the experts who recount how their double streams of revenue helped them build massive investments. A media personality who also runs comedy gigs can opt to save the money from the second stream to build his saving. However, this does not mean that you must have a big job to create new streams of revenue. Look at your lifestyle to identify areas of interest that you can get involved in to generate additional revenue. Some great examples include;

  • Consider online jobs after work that requires you to work a few hours every day.
  • Lend the dad’s car to a car hire company and use the wife’s car for daily commuting to work.
  • Start a baking shop and have one of the members of the family operating it.
  • Redesign one of the rooms by building an extension for renting.

The more you look at your lifestyle, the more the opportunities for generating streams of revenue.

Utilize the 50/30/20 saving rule

In many cases, the formula that you use for budgeting determines the success of the money saving effort. Though there are many formulae out there, one of the most effective is the 50/30/20 save rule. This rule means that 50% of the revenue goes directly to the saving, emergency, or checking account while 30% is used for personal lifestyle. The last 20% is reserved for fun but can always be altered to cater for shortfalls in personal lifestyle. Once you have developed the saving trend of at least 50%, it will accumulate fast and help you match to financial freedom.

Involve the entire family to build savings

While this remains a highly controversial consideration, those who use it reach financial freedom faster and enjoy every moment of their lives. If your spouse is working, share the expenses and contribute to the savings account together. As opposed to working alone which would require ten years of saving before buying a new house, a hand from your wife will make the dream a reality in just a few years. Remember that such a plan might require a legally abiding agreement to ensure that all parties are comfortable and identify fully with the outcome.

Four Mistakes to Avoid When Making Savings

Your path to financial freedom is dependent on adopting the right plan and sticking to it faithfully. However, many are the people who wallow in debts because they made grave mistakes. The following are key mistakes that you should always avoid to succeed in saving and personal investment.

Starting to save without a plan

While many people are busy planning for holiday and other fun activities, rarely is the same zeal manifested when it comes to saving. Failing to plan for saving means there is a high risk of allocating the finances to other non-essential areas because investment takes a back seat.

To create a good saving plan, you need to draw clear objectives on the short and long-term considerations. For example, you can set out a specific amount you want to save within 6 months, 18 months, and 36 months. This will give you the necessary connection and focus on working harder. Notably, the plan should include regular reviews and changes when necessary to make the main objective remain in sight.

Excluding financial education in your investment efforts

There is no shortcut about saving and investment; you must learn progressively. Over time, remitting your money to a saving account can cause a lot of fatigue. Some people might even start wondering why they are actually saving. If you fail to invest in financial education, the saving fire will soon ebb out.

Note that learning does not necessarily mean going back to college. You can follow training forums online, attend seminars, and ensure to get new skills over time. It is these skills that will help you learn about creating new streams of revenue, the best areas to invest for higher interest, and other knacks of growing wealth.

Not matching saving style with personal goals

Your saving efforts will only work if lifestyle matches personal goals. People who do not match their saving style with individual goals are bound to fail within a very short time. Note that there is no single best method for investment. Therefore, you must wade through a diversity of saving styles to see what best suits your lifestyle. For example, if an expert recommends that you apply the 50/30/20 financial style (50% saving, 30% personal lifestyle, and 20% fun), you might find it more rewarding by making some adjustments. For example, you could increase savings to 60% of the total revenue, use 30% on lifestyle and remaining 10% for fun.

Placing excessive trust on experts

While experts provide useful insights to help you draw good and realistic plans, placing excessive trust on them will be a great mistake. Financial institutions that advertise their services are for profit organizations with an eye on the fees you are going to pay. Besides, even advisors have offices, bills, and other expenses that they anticipate to pay by charging you a fee. Therefore, when you place a lot of interest on them, a conflict of interest will no doubt ensue.

The best thing is seeking expert advice objectively. You should be very clear on what you want and only bring the expert to help you attain the main goal. Remember also to take time selecting the right expert with an extra commitment to clients. Here, you might want to check the expert’s portfolio and feedbacks from past clients.