Meta Description: Starting out in your career, you need to save up money for all the things you want to do or buy for yourself. Take a look at some effective money-saving tips.
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Saving money can seem like a very difficult and daunting thing to do. Especially, if you are just starting out in your career, optimizing your income must be your major goal. Why?
The money you set aside every month can benefit you in more ways than one:
- You can start your own business after some time, or, use it to enhance your existing business
- You can invest your savings in stocks, property, or crypto, and add another income stream
- With your saving, you can make a trip to your favorite destinations on every vacation
- You can use your savings to build your dream home
- More importantly, you can get married without asking for financial help
While all of the above points make sense, the last one is more obvious, considering a high percentage of people who married at least once in their lifetime.
If you haven’t planned about it but getting married is on the cards, start setting aside some money right from day one.
Buying wedding dresses, engagement or wedding rings, and renting venues for special occasions require a hefty amount. In fact, lab-grown diamonds or diamond jewelry will require you to empty your pocket.
Top 12 Money-Saving Tips for People Starting Out Their Careers
Whether you’re getting married, buying a house, or starting a new business, savings can take some financial burden off your shoulders.
Here are some money-saving tips everyone should try!
Don’t Use Credit Cards In The Beginning
Credit cards sound very tempting for the benefits they offer. They allow you to buy things beyond your purchasing power. But the downside is, that you’ll have to pay the loan plus the additional amount as interest.
So, purchase of, say $1000, today can cost you around $1300 – 1500 when you repay the loan. This simply means you’re losing more money than you should. For people starting off their careers, using credit cards can be risky.
That’s because the job is still new and there’s a likelihood of early exits. In recent years, the unemployment rate for people aging 16-24 spiked to 24.4% during the period; from spring 2019 to spring 2020. The rate was 8.4% before spring 2019.
Moreover, there are more chances of employers changing their minds at any point during the probationary period. They’re always on the lookout for replacements and can reconsider a bad hiring decision.
Therefore, it would be wise to stick to saving rather than spending. Until and unless you’re stable enough in your job to repay these monthly loans with ease, never use a credit card.
Make Financial Goals
One of the most effective ways to save money is to make financial goals. Since you’re right at the beginning of your career, we won’t recommend setting unrealistic goals.
Start small. You can sit down every weekend and track your finances. Make a list of all your expenditures, and figure out how much you earned and how much you were able to save.
One important financial goal is to acquire tangible assets, such as car, house or expensive items. While buying a house with the limited income may not be as feasible as buying small jewelry items.
Gold rings, earrings or diamond tennis bracelet can stay with you for a lifetime. And they gain value over time. Unlike gold or silver, the price of diamonds may not fluctuate as quickly, but if you intend to keep them for 10-15 years, you can get high returns.
Use the 50-30-20 Rule
The 50-30-20 is a concrete rule for saving money. This rule implies that you spend 50% of your income on your necessities such as paying rent and buying utilities.
Use 30% of your income on your wants such as shopping and dining out. And the rest of the 20% should go into your savings account. This way, you will not have to deprive yourself of anything and still save up.
Set Up Your Saving Account
You can open a savings account retail bank, which will help you save more by setting limits on withdrawals. Saving accounts are not linked with debit cards, which means you won’t be able to withdraw your funds.
A Saving account also sets restrictions on transfers, but there is no restriction on deposits. This is to encourage people to save more and spend less. Last but not the least, you’ll earn interest on your deposits, so your savings will increase over time.
Cut Down Your Meal Expenses
According to Business Insider, Americans spend most of their money on food.
A survey related to the eating habits of the millennials revealed that more than half of the respondents like to eat out, buy coffee, or go to a bar once a week. But more importantly, they tend to dine out five times a week, on average.
So, how expensive dining out can be? Another research revealed that dining out or ordering a meal from a restaurant is five times more expensive than cooking at home. Moreover, popular restaurants are charging up to 300% more than the average dine-out cost.
Therefore, you must switch to cooking at home if you’re a new hire. Considering the facts and figures above, you can cut down 40% of your food expenses if you stop spending on eating out.
Rent Your Place Out
Another opportunity that you can avail yourself of to save up some extra cash is to rent out your place.
You can do so by making an account on Airbnb. It is an extra road you can take to earn additional cash by making just a small amount of effort.
Find Sources of Extra Income
As you’ve just started your career, think about keeping yourself involved with side-gigs or part-time jobs. Sectors like healthcare, medical services, and hospitality offer a lot of part-time job opportunities for young and old job seekers.
Moreover, you can try other side gigs, such as:
- Delivery driving
- Household help
- Shopping assistance
- Pet sitting
- Virtual assistance, etc.
Not only can you make extra money with your part-time job or side gig, but it will also prevent you from spending unnecessarily.
When you’re staying busy, you have less amount of time left to shop or spend money on unnecessary things.
Wait for Two Days Before Making a Purchase
We live in a world where instant gratification is an extremely common dilemma. You will see that most of your purchases are impulsive. Since buying things online has become so easy and convenient, one wishes to purchase anything they laid eyes on and liked.
So, we suggest that you delay this process. Don’t click on buy until 48-hours have passed. You will realize the thing you were ready to purchase within minutes was more of a want and not a need.
Learn DIY for Your Home
Everyone loved buying beautiful interiors for their homes. It brings gratification and makes your home look more personalized.
But, interior products do cost a hefty amount. So, you can learn DIY on Pinterest and decorate your home just the way you like it, without having to spend too much money.
Keep a Record of Your Transactions
Start maintaining a record of your income and expenses. And your target should be to keep your income higher than expenses at all times.
This mindset will help you:
- Cut down your expenses
- Look into your spending habits and control them
- Save more every week or month
For example, if you like to buy clothes every month, your record will reflect that. You can easily calculate how much have you spent on clothes compared to other expenses. Then, you can plan to reduce this expense and get more savings.
Cancel Unwanted Subscriptions
If you bought a gym membership that you don’t go to anymore or purchased an online subscription plan you don’t use, cancel it.
Most of the time, people forget to cancel these memberships because they don’t think it’s costing them a lot every month. But it does have a huge weight on your yearly income.
Don’t Forget to do Side Hustles
You can always freelance and find opportunities to work from home in your spare time. It is 2022 and there are hundreds of opportunities available online. All you have to do is tap into online freelance spaces, test your skills and earn with a side hustle.
For anyone who is in the very beginning of their career, saving money might seem like a difficult task which it truly is. But all you need is to plan out your budget, do some side hustle and follow the tricks listed above.
You will be able to save a lot of money by the end of the year if you work for it. All you have to do is be determined towards achieving your goal.