With economic uncertainty looming, it's always a smart move to boost your savings. Here are some top tips from millennial friends in their late 20s and early 30s to accelerate your savings rate:
1. Multiply Your Money
Invest in high-yield savings accounts, Singapore Savings Bonds, T-Bills, and reinvest dividends. Making your money work for you is key to growing your nest egg. Some friends dabble in stocks and cryptocurrency but that’s for people with higher risk appetite really.
Otherwise, find suitable ways to increase passive income or declutter your home.
2. Think Twice
One friend will wait for two to three days before deciding whether the item is still needed after the urge to spend fades off.
Another way is to evaluate purchases based on long-term use, like considering cost per wear of that new dress versus jeans.
Additionally, set a cap on meal expenses to keep your budget in check. For example, one friend allocated $6 for f&b on each meal to save money for wedding and new home months ahead, only going to hawkers and drinking kopi / teh. Don’t forget to use your CDC vouchers too.
3. Seek Discounts and Low-Cost Options
One friend always keeps a lookout for free or low-cost alternatives, such as borrowing or book swap from libraries and discounts at Guardian, Watsons etc.
Some other free activities include visiting Gardens by the Bay, Sentosa, East Coast Park, Singapore Botanic Gardens and window shopping.
Another uses a dedicated loyalty programme like the BreadTalk Group Rewards Mobile App to get 10% off at Food Junction and other perks.
You can also choose to opt for house brands over name brands at NTUC and Cold Storage or check dollar stores or Daiso for household essentials. Keep an eye on the clearance shelves and compare prices with online platforms too.
A recent First-Time Parents shared that they bought pre-loved items through Carousell and saved a huge amount for rather new items like baby clothes, seats and strollers.
Also, don’t take a taxi if you can travel as conveniently to the destination via MRT or bus.
4. Automate Your Savings
Set up automatic transfers to your savings account each month. This ensures a portion of your income is saved before you have a chance to spend it. Even better if 20 to 40% of income can be saved but this really differs based on each person’s situation.
Nevertheless, check through your needs and set aside enough for bills, insurance, loans, debts etc and still spend on some things that make you happy be it movies, games or sports.
5. Track Your Expenses
Use budgeting apps or an excel sheet to track your spending and identify areas where you can cut back. Knowing exactly where your money goes helps you make informed financial decisions. Finding another person to help you be accountable works too.
Do you really need the latest tech gadget? That’s also a good debate among friends at the dinner table. While the new phones come with high quality cameras and better specs, most of us just need to check emails, WhatsApp and scroll social media.
Another couple recently bought a decently big Prism TV for their new home so, shop smartly by comparing prices and specs to save some good money for the same usage.
6. Take Advantage of Cashback and Reward Programs
Sign up for cashback and rewards programs to get money back on your everyday purchases. This can add up over time but remember to pay on time monthly.
This is probably a very common method for Singaporeans. Another friend who’s preparing for marriage signed a new credit card just for expenses to clock miles. One more recently switched banks to leverage on the multiplier effect.
If you are still using cash frequently to limit spending, use a piggy bank to save up the loose change. You could be surprised at the amount over a few years.
7. Limit Subscriptions
Review your subscription services and cancel any that you don’t use regularly. This includes streaming services, and gym memberships.
By adopting these habits, you can significantly boost your savings and achieve your financial goals faster.
Candidly, ‘just stay at home’ as one friend commented. 😆
Master Your Finances Wisely,
Value Vaulter
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