How to Save Money

There are many ways and tactics to save money, but before you chose one that suits you, you need to understanding a few simple things first.

  1. You need an income.
  2. Your living expenses need to be below your income.
  3. You need some basic understanding of numbers. (Knowledge of simple mathematics. Addition, subtraction, multiplication, percentages, decimals, etc. Lack of money and having to survive from a very young age made me good with numbers. As I had to become able to get by with what I had, numbers became my friends.)


When is it that you live below, within or above your income? How do you know that?


  1. If you have a salary but there is nothing left at the end of the month, then you don’t live below your means. You live within your means.
  2. If you have a salary and also you are using credit cards to support your living, and at the end of the month you have no savings then you live above your means and also you have debt.
  3. For example. You have an income that lets say is 800. Dollars, sterling, euros. It doesn’t matter the currency. But your needs cost you 900. Then you are in debt. Because you need 100 more to survive.
  4. If you income is 800 and your needs cost you 800 then you’ll never be in debt but you won’t save anything either. But because you haven’t saved anything aside for a rainy day, when an emergency happens you won’t be able to withstand the hiccup. You’ll always be worried because you never know when your income source(s) will disappear or a health issue might turn up.
  5. If your income is 800 but your needs 700 then you can save 100.


How do you get your expenses to be below your income? How do you manage this?


  1. Your needs are food, shelter/safety, transport to work, clothes for weather and work, health and medicine.
  2. You need to survive. Therefore your income MUST cover your needs. That’s why you need to understand clearly what your needs and what your wants are first.
  3. If your income doesn’t cover your needs, your basic survival needs, then you have to find ways to increase your income or become creative with your needs and find a way to make ends meet. For instance, you might be able to teach German and your electrician wants to learn German but doesn’t have the money. You teach him and he pays you in services later on. Always be creative with needs.



  1. Once you have defined what your needs and wants are, then you can start budgeting according to when your income comes in or according to another time sequence that suits you best. Like when you pay your rent/mortgage, when you pay for your school tuition or when you pay your employees.
  2. You definitely need a budget. Preferably a long term budget, a yearly one, a five year one even a lifetime one if you are ready to plan for retirement. You are the only one who can decide on the time length of your budget. It all depends on what your life goals are and your current financial situation. It might be that you need to get out of debt asap, and what is happening in the future is not exactly of importance yet. You need to survive FIRST. Surviving now is a priority. You might be expecting a baby or you might still be in the process of discovering what it is that renders you broke at the end of every month.
  3. You are the one who knows what your goals and personal emergencies are. Your personal circumstances are your own and there is no need to apologise to anyone for them as long as you are financially independent and you don’t owe others money.
  4. Some people have a monthly salary, whereas some get paid weekly, some make odd jobs and get paid on the day or three months later. If you don’t know when your next pay check is going to come in, then you need a budget even the more.



Bus/train fare/tickets  
Car gas/petrol money  
Car insurance/parking money  
Work clothes/shoes  
Weather clothes/shoes  
Child/parent/invalid care  
Soap/Deodorant/shampoo/hair clips/shaving gear/haircuts  

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