The fact that feeling financially secure leads to a happier life isn’t a secret. If you have to worry about keeping up with the bills, buying food and paying for a roof over your head, stress takes a toll on your happiness as well as your physical health.
If you worry about making ends meet, don’t despair. Instead, take steps to get more out of your money and live a happier life. Follow these tips to begin a more secure and healthier life.
1. Save With Interest
You already know that saving money is important. But, did you know you can shop around for a higher interest rate for your savings? Placing money you already save in an account with a higher interest rate is an excellent way to make your money work for you.
2. Get Help
Most people would handle their money better if they only knew how. No one is born with money management skills.
A high-interest savings account is a great way to start, but savings accounts don’t give you the highest possible yield over time. Learning about the different types of saving and investment options is a confusing and often frightening proposition. But, it doesn’t have to be.
Financial firms, such as Asiaciti Trust, offer customized trust plans designed to meet your budgetary and long-term financial needs. Also check the Financial Planning Association of Singapore website. The site includes a searchable directory of certified professionals in specific fields of financial planning.
3. Consolidate Accounts
Many people believe that using multiple savings accounts to take advantage of the Singapore Deposit Insurance Corporation (SDIC) protections and earn various rewards from different banks is the most effective way to earn more. At first glance, separating funds seems like a logical choice.
But, the opposite is true. Researchers conducted a study to determine how separating money into various accounts with different financial institutions impacted spending. Surprisingly, they found that people using a single account spent 10 percent less when compared to those who had multiple accounts.
Research suggests that having a single account makes it easier to keep track of money and spending. A single account also earns more interest because interest is based on a larger sum of money. In other words, consolidating your money into one or two different accounts gives you a clearer picture of how much money you have and an easier way to track your spending.
4. Take a Realistic Look at Your Future Salary
The Asia-Pacific region is poised to remain on the path of continued growth. Your salary will likely increase over the next five years. However, your idea of how much your salary will grow and reality may not agree.
A survey conducted by Willis Towers Watson found that most of Singapore’s employers added salary increments of 4 percent to their 2019 budgets. Respondents expected their own salaries to increase by 50 percent or more over the next five years. But, recent history tells a different story.
Only 16 percent of the respondents had, in fact, received significant salary increases. Relying on salary increments that may never come is not a smart way to plan for the future. Building up a diversified passive income is.
5. Take Charge of Your Spending
If you’re like most people, you probably have no idea where your money goes. That morning trip to the coffee shop doesn’t seem like an extravagance, but it adds up.
To find out where you spend, take a week and find out. Record what you spend each time you buy coffee, go out to lunch, pay for entertainment, buy groceries and put gas in the car. You’ll be surprised at how much money goes out the door.
Also, take note of your spending mindset. Of course, you need suitable clothes for work. But, do you have to buy designer brands with high price tags? Do you find yourself shopping for one item and coming home with 10?
Analyze your spending habits and determine ways to cut back. Plan to keep more money in your bank account, learn how to invest for your future and remove the financial stress that takes a toll on your life.
Does keeping better track of your money and reducing expenses means you can’t have any fun? Not at all. It just means you’ll make better decisions. You’ll not only feel happier and less stressed, but you’ll also have a plan for a strong financial future.