The below article has been provided by Todd McCullough – an independent blogger and finance researcher. He writes financial advice and money saving themed articles for financing and loan websites such as www.Wonga.ca
Effectively building a savings account is an arduous task for the average person. It seems that throughout the month your entire pay cheque is gradually chiselled away until there is nothing left to spare by the end of the month and you’re anxiously awaiting that next cheque. Although it may seem like an impossibility at present, there are techniques that any person can implement that will help them in the development of a good savings account, some of these have been outlined below.
Have savings automatically taken from your wages.
It doesn’t have to be a huge percentage, but accept that this is money you cannot touch, so arrange your finances entirely around the remainder of your wages. It’s best to forget about this savings percentage entirely and the best way to do this is to set up an automatic direct debit into your separate savings account. These funds will slowly accumulate over time on auto pilot without you having to give it a second thought once you do the initial setting up.
Budget correctly and realistically.
There’s a big difference between what you want your ideal budget to be and what the realistic version is. It is naïve to believe you will stick to an overly strict and meagre budget. Allow your budget to accommodate occasional luxury items that you enjoy and you will be much more likely to maintain the budget with some conviction, be too harsh on yourself and you will find you quickly become fed up with the whole budgeting concept and your will power will soon crumble.
Avoid credit cards and bank overdrafts.
The first crucial step to building a savings account is to eradicate any existing debt you may have. In order to gain control of this cut up your credit card and only use bank accounts that don’t provide you with the possibility of an overdraft. By living directly out of your own wallet you will quickly gain a firmer handle of your finances while at the same time removing the threat of costly late payment penalty fees from your bank.
Re-examine your priorities.
Do you really need to renew your £30 per month contract to get the newest version of the iphone? Are you getting benefits from your gym membership that you couldn’t get just by running around your local park? Conduct a frank and stern assessment of where your money is going every month and ask yourself if you need it, and if you need it can you get a cheaper or free alternative of it somewhere else. You will be surprised at the fat you can trim if you are disciplined in this endeavour.
Contact your current amenity providers looking for a better deal.
A little research on the internet can enlighten you as to who is currently offering the best rates for gas, electricity, internet and satellite television. Use this new data to engage your current provider, tell them you’re planning on transferring to the better deal on offer by another provider unless they can match this offer. More often than not you will find your providers willing to make some financial concessions in order to keep you as a customer
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