Hello, fresh graduates! Congratulations on landing your first job. As you embark on this exciting new journey, one of the most important skills you’ll need to master is managing your finances.
Saving money might seem like a daunting task, especially when you’re aiming for a significant amount. But don’t worry, with the right strategies and a disciplined approach, it’s entirely possible.
Obviously your salary as a fresh grad will differ depending on your qualification, industry, and other factors. For the purpose of this article, let’s set a target of saving RM1,000 in 30 days.
Here’s how you could achieve this.
1. Set a clear goal
Setting a specific, well-defined goal is the first step, e.g. “To save RM1,000 in a month”. It’s like deciding upon your destination before you start a journey.
Write this goal down, put it on your fridge, or set a reminder on your phone.
Having a constant reminder will serve as a compass, keeping you focused and motivated. It’s a psychological trick that works wonders.
2. Create a budget
A budget is like a map for your financial journey. The idea is to identify what money you have coming in, and what you have going out.
- Start by listing all your income sources, which may consist of just your current salary.
- List all your expenses, including bills, groceries, transportation costs, and even weekend hangouts.
- Deduct your expenses. You should have some leftover to save and/or invest.
- Now go back to your expenses and scrutinise the list. Are there items you can reduce?
Knowing how your money flows in and out can give you a clear picture of your financial situation and show you where you can cut down.
3. Pare down non-essentials
It’s crucial to distinguish between essential and non-essential expenses, aka needs versus wants. Prioritise setting cash aside for things that are necessary such as rent and food.
Cutting down on expenses can free up a significant amount of money. For instance, if you spend RM20 a day on coffee, that’s RM600 a month you could be saving!
So, think about whether you really need items such as monthly subscriptions or expensive dining. Which leads to:
4. Cook at home
Eating out can be expensive, and as a fresh graduate, it’s a luxury you should limit. By cooking at home, you can save a considerable amount of money.
Plan your meals, make a shopping list, and stick to it. Avoid impulse purchases, and try to cook in bulk to save time and money. Plus, cooking is a great life skill to have, and it’s healthier, too.
5. Sell unwanted items
Look around your home for things you no longer need or use. Selling these online or at car-boot sales on weekends can be a quick way to make some extra cash.
Clothes, electronics, furniture, and books are just a few examples of what you can sell. It’s a win-win situation – you declutter your space and earn money at the same time.
6. Take on a side job or freelance work
If your current income isn’t enough to save your goal of RM1,000 in a month, consider taking on a side job or freelance work.
There are many online platforms where you can find freelance jobs that suit your skills and schedule. It could be anything from graphic design and content writing to tutoring or even pet sitting.
As a bonus, you get to broaden your skill set.
7. Save on utilities
Be mindful of your utility usage. Turn off lights when you leave a room, unplug electronics when they’re not in use, and try to use less water.
These small changes can lead to noticeable savings on your bills. It’s not just about saving money, it’s also about being environmentally friendly.
8. Use public transport or carpool
If possible, use public transportation or carpool instead of driving. This can save you money on petrol, parking, and maintenance.
If you live close to your workplace, you might even consider walking or biking. Not only will you save money, you’ll get some exercise and reduce your carbon footprint at the same time!
9. Avoid impulse buys
Impulse purchases can quickly eat into your budget. Always ask yourself if you really need something before buying it. If it’s not a necessity, skip it.
This might be tough, especially with online shopping just a click away, but remember your goal. A good trick is to wait a day or two before making a purchase. Often, you’ll find that the urge to buy has passed.
10. Track your progress
Keep track of how you are doing by using a savings app or simple spreadsheet. This will help you stay motivated and let you know if you need to adjust your strategies.
It’s also important to celebrate small victories along the way to keep your momentum going.
Remember, saving money on a small income requires discipline, creativity, and a willingness to make temporary sacrifices. But the sense of accomplishment you’ll feel when you reach your goal will make it all worth it!