However, many people deem this target unrealistic and van Heerde says the key is to “break the hand to mouth pattern”.<\/p>\n
\u201cA strategy of saving whatever is left after spending is unlikely to succeed or get you out of the pay cheque to pay cheque scenario. You need to do the reverse of that in order to break the pattern.\u201d<\/p>\n
She shared the following steps that can help you start saving from your currently stretched budget.<\/p>\n
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Reassess your debt – not all of it is bad<\/strong><\/p>\n Van Heerde says you will most likely find money to save when you start using debt effectively.<\/p>\n \u201cTry to stick to good debt (e.g. house, studies) and use cash for other expenses instead of using credit or store cards. You pay high interest on short-term debt, so make it a priority to reduce it. Once that is done, save the money that used to go to debt repayment.\u201d<\/p>\n Pay yourself first<\/strong><\/p>\n Put money away for saving as soon as you receive your salary. Van Heerde says it is best if this happens automatically.<\/p>\n \u201cIf you are first going to repay debt, try to increase the repayment amount. If you are ready to start saving, put a debit order in place. And, if you are struggling to put money away at the moment, the best time to start is when you get an increase.\u201d<\/p>\n You need a diary<\/strong><\/p>\n \u201cKeep a spending diary for a month. Split your debit orders into debt repayments, essential expenses and non-essentials like eating out, coffee or magazine subscriptions.<\/p>\n “You may be able to create room to save once you\u2019ve taken a hard look at your non-essential expenses. You also need to be critical \u2013 clothes are essential, but perhaps not those designer heels and you don\u2019t need to buy something just because it\u2019s on sale.”<\/p>\n Eliminate\u00a0non-essential expenses and go cheap<\/strong><\/p>\n Most of us have a good idea of what our monthly essential expenses are, but van Heerde points out that we often don\u2019t track our spending on non-essentials.<\/p>\n \u201cDecide which of the non-essential are important to you and what you are willing to give up. For example, you can bring your own lunch to work, review your cell phone plan, use Wi-Fi calling or other social network calling options,\u201d said van Heerde.<\/p>\n She also suggests trying cheaper alternatives for things you do often.<\/p>\n “For instance, if you eat out with your friends every weekend, you could replace some of these with an evening at someone\u2019s house where everyone brings a dish or a course.”<\/p>\n Create a realistic budget<\/strong><\/p>\n Van Heerde says while you need to make allowance for savings, you also need to budget for things that give you joy. Otherwise you run the risk of spending money on such things without actually budgeting for them.<\/p>\n “At least if you budget for them, you can make adjustments to your other monthly expenses upfront.”<\/p>\n \u201cIt is easy to spend a lot of money on little things which you may not even be able to recall at the end of the month. Rather use your money to save for a real treat. Always make a list before you go shopping \u2013 this will help you stick to items that are in your budget and not get distracted.\u201d<\/p>\n Save toward a goal that means something to you<\/strong><\/p>\n![](\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2014\/06\/Debt-erasing.png\")
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