Saving is a habit, like going to the gym or improving your diet. Although taking the first steps can be challenging, the satisfaction of seeing your goals met fuels the motivation to continue saving. In this way, little by little, you can achieve more ambitious goals that initially seemed unattainable, such as purchasing a home or taking that long-awaited trip that you have wanted for so long. But how do you start saving without dying trying?
For the specialists of the financial comparator HelpMyCash.com, the key is to allocate a fixed amount to savings each month and, mainly, separate it as soon as the payroll is collected.
"The most common mistake when it comes to starting to save is to think that savings is what remains after covering all monthly expenses. Following this logic, it is difficult to achieve our goals, since we live in a world where expenses seem endless To save effectively, we must include savings in our monthly budget and decide, for example, to set aside one hundred euros per month," explain the experts at HelpMyCash.
To make it more effective, they suggest opening a bank account for savings. "These accounts make the task easier, since they allow us to separate savings from the money we allocate to our daily expenses. In this way, it is more difficult to fall into the temptation of spending the money we have set aside," the experts point out. Additionally, many savings accounts today offer returns, allowing you to grow savings without any additional effort and with minimal risk.
"Today, there are accounts without commissions or requirements that offer returns of up to 3.25% APR," say experts. In addition, these accounts are backed by the Deposit Guarantee Fund, which covers up to 100,000 euros per bank and holder.
Although there are general rules that suggest allocating 50% of income to fixed expenses, 30% to variable expenses and 20% to savings, it is important to remember that each situation is unique. Instead of following a fixed rule, HelpMyCash experts emphasize the importance of creating a personalized budget to determine a realistic and achievable amount.
"There is no point in committing to setting aside 300 euros a month if we then find ourselves having difficulties making ends meet. Instead, it is important to define our own possibilities through a budget," they suggest.
And what is a budget? It consists of recording monthly income and expenses in a spreadsheet. Then, the expenses of the last six months are analyzed and it is defined how much money will be allocated to each expense each month. For example, you can allocate 500 euros to rent, 250 to shopping baskets, 200 to leisure and 100 to savings. “The most important thing is that the amount allocated to savings is realistic and sustainable in the long term,” they say from HelpMyCash.
In addition, they suggest setting specific savings goals, such as taking a trip, buying a car, or saving the money necessary to get a mortgage. If these objectives are medium or long term, experts also advise taking advantage of fixed-term deposits. "Today, there are one-year deposits with returns of up to 4.40% APR," they say.
Until recently, achieving this profitability required taking risks, investing in shares, but in the current context of high interest rates, European banks are offering interesting fixed-term returns, allowing savers to grow their money without taking on large risks.
