The 5 Money Principles of A Savings Guru On Accumulating Wealth
Warren Buffett was a money guru with a sharp business mind. By saving and investing, he accumulated over $90,000 by the time he was done with college. It's no surprise people all over the world look up to him as a role model and guru.
Truth is, many of us can plan and start saving at any age! If you want to be financially savvy and hip with money, here are 5 tips to help you get started.
1. Don't put off until tomorrow what you can do today
If you want to get cracking on your guru status, you should start immediately. This means: Save right away.
Why, you ask? As your nearest financial advisor (read – insurance agent friend who suddenly appeared after years of non-contact) will tell you, when you start saving now, you will have more time to save more money which ultimately means that you will have a higher amount of savings eventually.
If you’re 25 and you start saving $200 every month until you are 55, you will have $72,000 worth of savings. But the amount drops to $48,000 if you only start saving from age 35 onwards.
So put your dollars into savings post-haste!
2. Maximise your savings growth rate in stages
The main strategy of any savings guru is to maximise and grow their savings in the most practical way possible. There are many ways to do this, with varying levels of risks and returns.
The lowest risk method of growing your savings is to leave the money in the bank. Be on the lookout for bank savings account plans that have the highest interest rates, and put a majority of your savings there. In recent years, many banks have been offering unbelievably high interest rates, so now is the right time to take advantage of it.
Once you’ve mastered the less risky avenues, you can then venture into the higher risk but higher returns savings growth strategies.
3. Select the right suite of saving tools
As a savings guru, you are expected to always be vigilant and up to date on the best deals and promotions and tools that can help you save.
One such tools is the credit card. Contrary to popular belief, credit cards might not entirely be the bane of the savings guru’s existence. In today’s world, spending money is unavoidable and necessary for survival, so embrace that fact and utilize credit cards to your benefit. Choose cards that can give substantial discounts on your purchases or even cashback privileges.
However, before you jump entirely into getting a credit card, ensure that you read between the lines of the terms and conditions. If you're a first time credit card applicant, read this post to find out what you should take note of.
Apply for credit cards with Cardable, to unlock cash rebates, cash backs and many other credit card promotions on Klook, Agoda, in Singapore and HongKong.
4. Find avenues for additional income
Gone are the days when a single income could make dreams come true. The modern savings guru mantra is to get money in as many avenues as possible, and to diversify your income options.
If you have the time and the capacity, you could take an additional job or do a side-line business. If you have an understanding of the investment world or the stock market, consider venturing into those too.
5. Set goals to sustain the savings mindset
As the cliché goes, “If you fail to plan, you plan to fail.” We might be told to mindlessly save just for a rainy day, but our personal definitions of rainy days will start to become fluid and flexible when stuff like wants and desires come into the picture. Instead, set clear and definite goals, especially in terms of the numerical target.
It helps to have a few different savings funds as well. For example, divide your savings into different categories such as an emergency savings fund, a travel fund or and education fund. In this way, you limit the amount of savings you use for each purpose.
