There is a simple money saving exercise that everyone should do at least once in their lives. It is ultimately one of the best ways to save money, because it is not about pinching coins. But about discovering what you really want and getting it. It is so simple you may hesitate to try it.
Heck! Just try it for fun. Here it is:
Simple Money Saving Exercise That Everyone Should Do
To start off the simple money saving exercise, list everything that you have spent money on, are currently spending money on, or might spend money on.
Don’t just read this and think of a few things. Take the time to actually write it all down. Review your bank statements if you have to, in order to remember and include everything.
Now go through the list, and carefully consider each item. This money saving exercise will let you determine the big items you are spending on. Take the most time on the big items – past, present and future possibilities.
If your timeshare on the beach is worth half of what you paid, say costs 10,000 pesos per year in expenses, and is rarely used, you need to learn from that – not to punish yourself, but to have a richer life.
If you think honestly about the number of times you will use that recreational vehicle, and the cost, it may be 3,000 pesos for each day of use. That’s okay if that is worth it to you, but maybe you really would enjoy 6,000 pesos hotel per day more. Or maybe you can rent a van for less overall cost, thus freeing up money for other important goals.
Saving money is not about sacrifice
You see, saving money is not about sacrifice. We all are aware of the scrooges in life that pinch their money, bank the savings, and then do nothing with it.
The point should be to save money in one area of life so you can use it in ways that make your whole life richer. It is the real purpose of the money saving exercise.
Suppose you notice you are spending 2,000 pesos per month on subscriptions to magazine you don’t read, or on insurance for a motorcycle you almost never ride?
Cancel the subscriptions or sell the motorcycle. And what have you lost? Is it a big deal? What will that 2,000 pesos get you instead?
- Bank it for ten years, and use the 240,000 pesos to take a second honeymoon.
- Use it to pay for a day off work once a year, to spend with the kids.
- Invest it, to have an extra 2,000 pesos per month during your retirement years.
- Buy 12 good books a year, to learn something new.
- Make banana splits for the family once a month.
- Give 10,000 per year to a worthy cause.
Final thoughts
Do the simple money saving exercise once in your life and maybe you will learn that 2,000 pesos per month can do a lot if used wisely. Imagine what you could do if you stopped wasting that money per month.
That is why it is so important to discover what you really need and what you don’t need. This is one of the most intelligent ways to save money.