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Several Money Saving Tips

ElitePersonalFinance

Last Update: February 11, 2021 • Save Money •

Are you working and earning some salary, or are you an investor and making some profit. Worry not because we have come to your rescue in terms of financial tips. For sure, your finances are the ones that drive your life. You may live a stagnant life with no growth or live a life full of change in terms of finances. To achieve this set of personal financial short term goals is very important. These goals might be of help to you in the short run and both in the long run.

Saving for an Item

On this diverse planet called earth, every one of us got our own wishes and desires. For instance, some people desire to own state of the art cars while others aspire to live in mega structured houses. Rome was not built in a day the same way achieving these goals cannot be done in a single day.

This is the reason why your finances play a major role in achieving this. To enjoy such items’ utility, you need to forego utilities’ enjoyment derived from consuming other products. You have to set your short term financial goals to achieve this. Take an example of a person who enjoyed a five-star dinner every Friday, and he desires to purchase a car in the next year.

He will have to decide to forego the five-star dinners and instead save the money every Friday. In the first few weeks, the cash being saved may look quite useless. But never be tempted to quit your savings schedule. This explains why resources are scarce, and they have a price tag on them. After a few months, you will realize that your savings are accumulating bit by bit. In the end, you will find yourself driving an automobile bought from your weekly savings.

Pay off Debts

Debts are part and parcel of our lifestyle. No one can survive without taking a debt either from a friend or a financial institution. It is quite obvious that the debts come with an interest rate attached to them. The longer you take to settle off a debt, the more expensive it is to you. The shorter you accept to pay off a debt, the less expensive it is.

Having this in mind, then paying off debt should be one of your short term financial goals. You have to decide that this debt is not going to eat up into your finances anymore. The borrower’s property has been auctioned due to their failure to settle off their debts. Why choose not that your property will never be auctioned for failure to pay your debts.

The most viable method is to pay off the debt in higher installments than agreed with the bank. If you had agreed on $20 a month, you might choose to pay double that in a month. If you can settle the debt in one lump sum payment, you can do it. When this is, you expect the charges associated with your loan to be reduced. The irony is that this can only happen if you prioritize settling off your debt as a short-term financial goal.

Target Small Amounts

A small baby cannot run without having to learn how to walk. The tricky part is to ensure that the baby never stops walking. In your financial goals, this is arguably the case. You cannot wake up one day and abruptly set up a long term financial goal. You have to start by setting up the short-term financial goal. Then as time goes, you will move forward to the long-term financial plan.

In investment cycles, this is the case. When you decide to start up wholesale and retail stores, the initial capital outlay is very high. You cannot acquire all the capital needed for this venture in one day. Prior planning and market analysis need to have taken place earlier. Thus in your plans, at first might be to look for money to rent or build the premises. In the following year, you save money to do the market research. Finally, in the third year, you purchase the stock and start the venture. This clearly shows that the short term financial goals coupled together translate into the long term financial goal.

Emergency Fund

The emergency fund has its roots in the precautionary demand for money. This is where you hold money to cater for the occurrence of events that were not foreseen. For instance, you may triple while walking and injure your leg. Definitely, you will need to seek treatment at a cost. The money to cater for the treatment may not be readily available.

The importance of the emergency fund comes to focus here. You may choose to hold the emergency fund in the form of savings, liquid cash, or an insurance cover. This fund will help your cater for your treatment without much hustles and struggles.

Saving for your retirement is also a short-term financial goal which one should have. It may be a long term goal, but it derives its roots from the short term goal. When one retires, you are too old and weak to work. The need for an emergency fund to cater to your day to day needs arises. This is why saving for this fund from an early in advance is important since many funds will have accumulated. Thus, the funds can cater to you until death and leave the surplus to your siblings.

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