Topic: Cracking the Code of Saving Money... - page 5. (Read 1704 times)

Totally understand the P2P Contribution method you are referring to.
In my country it is called "ARISAN", we will save money within a certain time, it can be every day, every week or even every month with an agreed amount.
But this will go through a drawing process so that it will be selected who is entitled to receive the money in the first, second, third session and so on.

This will run for a period of time that has been determined at the beginning, even if it is done every week it will last for years depending on how many members participate.

My wife is even participating in it right now and it's been running for about a couple of months with weekly payments.

People who can save money and use it well are very lucky. Not everyone has the opportunity to save. Some people cannot even think about saving because they do not have the income to save. Often people with low incomes choose to save when their income increases because they realize the importance of saving because they couldn't do it before.

Sometimes life gives us the chance to learn things. In such cases, we need to improve ourselves and take advantage of the opportunities that arise. Saving is something that every person should do if they can.

   Saving your money is a good step towards managing money wisely. But that's only the first step. Before we dive deep into it, let's first look at how you should not save money. If you're saving money in the form of cash, it's not a wise decision. When you save money in cash for a long period of time, you're ensuring that you get less money than you saved. Confused? Let me explain. When you save money in cash for a long period of time, the amount remains the same but the market is constantly evolving so due to inflation the true value of your money decreases.
  A financially literate person would never make save their money in the form of cash. Now you must be thinking, “so what would be the best way to save money?” The answer to this question depends on you. You have various choices and every choice comes with its risks and rewards. You know your situation better than anyone else so, you would understand which option is best suited for you. You can keep your savings in a bank or better still invest with it that way you'll get some interest on your money and you'll be able to access your money whenever you want.

In my country, there's something they call a p2p contribution. It is normally organized by just common people, so they can decide to get more people who are very interested and capable of holding the contribution until it is concluded.

In this kind of p2p contribution I am talking about, if they have like 100 people that have agreed to work together for one goal, they will all agree on the amount that each person can contribute each day.

Let's say there are 100 people, and they have decided to contribute $5 each every day. They will then choose a Treasurer that will be in charge of the fund. So, the process is that after everyone has contributed for the first day, the treasurer will give the $500 to one of the contributors. The next day too, another contributor will take the whole money ($500) after they've all contributed. The trend continues from the first person until the last 100th person. If it's a p2p contribution of 100 people, that means it's going to last for 100 days (about 3 months and a week).

So, if each person is contributing $5 x 100 people, that's $500 that one of the contributors will take each day and the next day another will take.

The reason why they do this P2P contribution is to help those who cannot gradually save up money to be able to have a lump sum of $500 at once, and the person can possibly use the money to start a business or an investment that will be profitable.

OP and anyone who is reading this post, if you did understand what I explained, that's one way to save a small amount of money each day, and when it's your turn to take it, you will have all the money in a lump sum.

$1000 is a crazy example of course i know the cost of living is different for each country but if you’re earning $1000/month in my country you’re definitely well off or at least comfortable enough and unless you have children you’re probably not gonna be able to spend all that and not save a little bit

18% of the people in my country live as low income and gets not even half of $1000 usd  if you’re struggling to save with a salary of $1000 imagine how hard it is to save for those with less than that

Surely we cannot generalize all the abilities that each person has. I also often hear people say that they don't want to start saving and have savings, but circumstances force them to and they can't do it. Before thinking about this, I think we must first take steps where our financial situation is stable or at least we must have a decent income first, whether it's finding a better job or building a business.
I was once in a situation where even being able to eat was a joy, because the situation was very difficult at the time. But when I had a decent and stable income, I was able to start thinking about saving money or even like now, getting into the investment space.

Some people earn even less than that, and it's extremely hard for them to save something. You know what, I was one of those people during some period of time, for years actually. And I can tell this much: if you earn so little,  you never give saving a thought even. You just live. You are happy you can buy a loaf of bread, and if you can "save" to buy a bus ticket to not be walking for two hours to your home, you are super happy.

The first step for people thinking about saving is to get out of debt, because that's the starting point for so many people. Holding debt while trying to save can often leave you worse off, if you're paying 20% per year on a credit card balance but have a small amount of "savings" earning 5% then you should direct all those funds to bringing down the balance first, otherwise you've just got the illusion of savings that is costing you more. You should target your most expensive debt first and clear that, but possibly consolidate where you can. Increasing your earnings is one way to boost your spending, but you should also occasionally re-evaluate how you are spending money too and cut back on excess until debt is paid off.

What about those who don't earn a lot? Someone with a limited salary cannot separate a specific percentage from it for savings and then spend the rest on other things because the rest might not be enough. If you earn $1,000 a month and have expenses that covers almost the whole amount or even higher sometimes, you can't have much savings or any savings in that case.

Exactly, it is not always possible for everyone to be able to save money from the salary you get, that's why it becomes necessary to find an extra source of income, something that will earn you some money that you can use either for your savings or add it up to your budget and take a percentage out from the total for your savings.

Of course it can't be always like that. We can talk only about probabilities. How probable is that your investment will fail? That's what everyone should think about before investing in anything. If you just think, "everyone fails with that but I will not", that's hardly a good way of thinking.

Saving money in your local currency, especially if you live in a troubled country, is very risky. I'd say, maybe it's riskier than investing in an established business. But saving in USD is probably more safe than anything else. USD can lose it's purchasing power with time, sure, but not to such an extent that it would be a disaster.

I saw this tip on how to save money on social media. It says that if you receive your salary before anything else or before distributing your expenses and such, the first thing you will do is allocate an amount to your savings, and after that, you can distribute it to other things, such as bills or other things you will spend. or you can spend quite an amount in investment, of course, with sure profit, like trading. That's what I do; the profit I earn from trading will go straight to my savings; if not, then in another section of my budget. In short, you can't save much from your salary, so find another side hustle that will add up a profit and also add up your savings. Don't settle for less; keep on striving and finding a way to have a better life and bigger savings. That's what I learned.

It is also a better solution if someone is able to increase the interest to use it in life, because this can also influence the savings side to become bigger and swell. However, trying to increase interest more in life through savings is also not an easy matter now, considering that currently it is still difficult for some people to increase savings. So it will also make them experience difficulties in increasing the interest to be bigger for them to use in their own lives, even though this is a pretty good solution to do for those who can afford it.

By savings first and spending from interest earned from your savings, I read this somewhere on the Internet and it's stuck with me ever since,  I find it true from my personal experience as well. Interest might not be enough but what one could do is increase savings further and further until interest is good enough to sustain oneself.

Any person who has a family basically works and earns money so that they can provide for them and make them happy and to make them happy one needs money, for sure. So planning vacations, celebrating special days, and occasionally going out, are all important things that are supposed to be done and you can't skip these things just so that you can save some money, you need to skip things that are extra and that aren't necessary in order to get to have some money left at the end of the month.

That's why, one should never compromise on important things and things that make them and their families happy and they should think of other ways that they can use to save money. If they think they can't do it with a single job, they should try and start doing some side job or something that can earn them something extra.

Logically we can only save when all our living needs have been met, so there are several steps we must take first to be able to achieve our desired goal, namely being able to save.
Regarding earning extra money because the main income is only able to meet life's needs, we will have additional tasks and we have to do that because it is impossible to live by just watching without making any progress.
Do extra work to have more income, then apply strategies in life to be able to save or invest, those are different plans in my opinion, the most important thing is that we have to have more money first to be able to do all these things.

By having an income that can only cover a month's needs, of course we have to look for additional income to be able to save because if we have an income that is only enough for a month's needs and don't have savings for emergency needs, it will certainly be very difficult for us if we get unexpected needs, of course we have to take on debt to meet these needs.
If we choose to invest, of course we have to do it consistently and also use strategies in the investments we make to gain profits. Yes, you are right, we have to keep control of our expenses so we don't use them for things that are not important.

I agree. Don't be complacent for what you currently earn especially if you know that it's just enough for the monthly expenses. Looking for opportunity to have another source to earn money is always wise, this is to increase the earnings and to be able to save money. Anyway, I don't consider bank deposit as an investment since the annual interest is too low and not worth it (at least for me).

Hence, I better look for other opportunities to invest. Of course it's not going to be easy and there are times you'll fail, but keep trying and stick to an investment where you have knowledge about and not just you're taking risk without knowing what you're getting into. Nevertheless, always have self-discipline to control how you spend your money.

also needs to keep in mind though, investment doesn't necessarily always results in success, its essential to choose investment based on fundamental, the only investment thats safe are investment that gives really low yield or return, therefore investment like bank deposits and so on, don't expect to get rich from it but instead expect it to at least give additional capital growth on top of combating the curent inflation.
but whats more important is to increase income, can't expect to save because the salary increase right now aren't really on par with the inflation increase therefore the disparity between the price of the goods and our purchasing power will get more bigger and bigger, thats just how bad it is the current condition for people with low income, its just increasing income is the only way.

Stay at home most often if you want to avoid expenses like eating on fancy restaurants, or shopping on malls. What you want to do today might not be the same thing tomorrow. That’s one way of saving. Also, live life within your means. Do not spend above your income, otherwise you’ll end up having a lot of debt. Lastly, learn to invest more than saving a lot. Your savings has rare chances to grow, but when you invest, your capital might be double or triple in time as long as you invest on those high potentials to succeed. Hence, you will be more capable to save if you have a sustainable investment on the side.

Although taking risks does not guarantee success, in my opinion this is one way to take steps forward, I admit that people who take risks are brave people. Because people like this have the courage to try with the risks they will face, however, we ourselves will determine all the choices and steps for the next time only we choose, suggestions and input from people are just a consideration. Everyone doesn't want problems that suddenly come, but who knows. By having savings, I think maybe it will be useful at times like this, so that when we are in a situation like this it is less likely that we will link other people because those of us who do not have savings can just borrow here and there.

I spend my money according to what I need not what I want, but most people spend their money on what they want even though the function and role of the items they buy are not that important. Before doing something that will produce even with the risk, I think I myself must have thought about it first because everyone knows that no one wants a loss, but of course with careful thought, there must be a risk. So I think it's natural that there are risks that we will face because basically everything must have its own risks.