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I get a lot of emails from readers saying “I struggle to save, what can I do?” Do you find yourself in the same boat? Do you start to save and then something will come up in the month and you have to use your savings? And now you have to start all over again
 
This can be very frustrating, I know because that used to be me.
 
If you have no savings, life can be stressful. When you have a financial emergency and your first thought is ‘I have no savings,’ it can be a scary moment. As a matter of fact, a growing number of South Africans have no savings either. And so this feeling is quite common for many.
 
If you are starting from scratch, the idea of building a solid financial future might seem daunting. The good news, is that it is possible to build savings from any point even if you have none right now.
 
If you are ready to learn what you can do if you have no savings, then continue reading.

 

Do you know where you stand?

The fact that you want to work to improve your financial future is a big step in the right direction. Now that you are ready to take control of finances, it is time to take a closer look at your financial life.
 
First, layout any debts that you have on the table. It is important to see all your liabilities, or debts, in a single place. Next, tally up your assets. Then subtract your liabilities from your assets.
 
If you’re looking at your total net worth and see a negative number, keep breathing! It will be negative (more liabilities than assets) for 95% of the population.
 
No matter where you are starting from, it is good to be realistic about your financial future. If you are starting from 0 or a negative net worth, then you should not expect to clean this up overnight. In fact, building a better financial future may be a long road. But, the sooner you start the process, the faster you will achieve your goal.
 

Get on a Budget

Dive into your spending habits to understand your financial position better. Are you living beyond your means? Your first step should be to create a plan that ensures you are not spending more than your income. Otherwise, it is easy to rack up debt.
 
A budget will help you diagnose your savings problem. A budget can help you identify your problem areas. Then you can come up with strategies to make saving money easier. Once you have a list of your expenses and income, you begin to make changes in your habits.
 

Start an Emergency Fund

An emergency fund will protect your savings. It is money set aside to cover unexpected bills and expenses. If you still have debt, then you need to have about one month of expenses in your emergency fund. If this feels like too much, aim for R5,000 to start. This will make it easier to focus on your other goals because you know you have your emergencies are covered. If you don’t have an emergency fund, building one up should be your top priority before you pay down debt or buy other items
 

Pay off your debts

As much as we all hate debt, most people have to admit that they have debt or have had debt at one point in time. Credit cards, student loans, car loans, overdrafts, personal loans, mortgages, are usually the big items in people’s debt portfolios.
 
It’s easy to get overwhelmed with so many bills to pay. But the good news is that with changed spending habits and re-prioritizing your finances you can pay your debt off and have peace of mind.
 
Since you are ready to build a better financial future, that starts with eliminating your debt. You’ll need to find a debt pay-down strategy that works for you. Take a minute to find out which strategy will work best for your situation. Then dive into your debt repayment journey.
 
Once you’ve paid off your debt, it will be easier to save for long-term goals.
14 Day Financial Detox Challenge

A financial detox is the process of giving your wallet some room to breathe. It’s pressing reset on your spending habits. And it’s being more intentional about how you view and relate to money

Find Ways to Save Every Day

Find ways to save at the grocery store, on your utilities and your monthly bills. Switch plans and providers with insurance and cell phones to save money. You should consider cutting cable and choosing less expensive options to save on all your expenses. Limit the amount you spend on entertainment so that you only spend on what is most important to you. Make a goal to cut back in your biggest categories by 5% each month.
 
It’s important to note that as you go through this process, make sure you still permit yourself an allowance and some fun money. So you don’t feel deprived and resentful as you try to save.
 

Put your savings on autopilot

Once you’ve worked out your budget, you could choose to automatically transfer your savings into a separate account each month.
 
If you have trouble sticking to a budget if the money is readily available, then move it to a separate account that is slightly less accessible. With that, you’ll be forced to think about your spending actions before you swipe your card.
 

Make Saving a Habit

If you make saving money a lifelong habit, it can help relieve the stress of managing your money.
 
As you make saving a priority, you will begin to automatically research prices before you go to the store. This will help stop impulse purchases and make you more aware of what you are spending.
 
The important thing is to start small and incorporate these habits into your daily life. You can’t expect your financial situation to change until you make saving a priority.

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