Would you like to save money but the effort is too high? Want to cut costs but are afraid of losing your quality of life? Would you like to know how to save money every month? In this article we will give you some tips and rules for you to save money but we warn you that everything worthwhile involves some effort. In the field of savings, if you can create real savings habits you will greatly reduce your effort to raise money that will earn you interest every month .
Do you know the 10% Rule?
Financial advisors often say that we should always save 10% of our monthly income. So, if you win € 500 a month you should set aside € 50 every month. If you win € 1,500 you should raise € 150 and so on.
At Diedrich Knickerbocker we do not like to generalize and we think every case is a case. However, this should not be seen as a posture of lesser requirement. By the way, we know that the big beneficiaries of savings are the families that save so we always appeal to some requirement.
Today it may seem impossible for you to save 10% of your monthly income. However, if you start the process on the basis of a well-structured family budget you will feel that the effort will ease over time.
Do you know compound interest?
If you can save 10% of your income each month and you keep your savings invested for some time, you will start to receive interest on the interest you have already received in the previous year. Confused?
Imagine you have € 1,000 in a savings account and you had a 5% return this year. So he earned € 50 in interest. The following month instead of investing € 1,000 will invest € 1,050 and it is on this amount that they will focus interest. If the return is 5% you will receive € 52.5 of interest. That is, earned more € 2.50 than the previous year, doing nothing for that. At the end of 15 years you will have doubled your money and by the end of 22 will have tripled. It’s your money working for you , 24 hours a day, without rest and without strikes.
Do you know the Rule of 100?
Another rule to help you decide how to save money is the 100% rule in investments . This rule assumes that you should invest your assets by taking risk in your portfolio. And it says that the weight of products at risk should be equal to the difference between 100 and your current age. So if you are currently 30 you should invest 70% of your capital in risky products, in the expectation of getting higher returns in your portfolio.
You may not like risk but capital markets help you make money . So the question of how to save money responds with effort, rigor and assuming calculated risks.
Want to Know How to Save Money?
We mentioned above that it is difficult to save money without some effort . If you follow these rules and if you have a posture of permanent cost cutting that are not essential to your life you will be able to have a family budget that allows you to save money.
Being rich is not a science and is not the result of luck. It is the result of effort and respect for some simple but very effective rules. Do you know how to save money? Leave us your tips and help our readers save money every month.