10 Tips on How to Save Money from Your Salary in a Bank

Learning how to save money from your salary is a skill that everyone should learn. It’s a discipline that takes time to build but can be honed at any age. However, it may be difficult to achieve at first if you don’t know where to start.

Given the right tips on how to save money from your salary and the right tools, you can secure your future self’s financial well-being with the right financial practices. Here are some of our top tips on how you can do this:

Track Spending

The first step to achieving better finance habits is to know what you’re spending your money on.

By tracking your spending, you get the chance to gauge which aspects you spend the most on and cut down on them. Make sure to cultivate the habit of tracking your expenses so you gain the awareness you need to improve your spending.

To track and record your expenses, you can use a notebook or an app. Although, with the many finance apps available online, their portability, and their accessibility, we recommend using an app to help you keep track of your expenses.

Pay Off Debts

Ideally, you want to pay your debts first before you start building your savings and investments. Why? This is because it’s much harder to save if you have debts. It’s like splitting your focus into two.

Consolidating all your extra money and putting your maximum effort into eliminating debt can help deal with interest and late fees.

Once you’re done paying off your debts, you’ll be surprised at how much money you have leftover, and then you can put all your resources into building your emergency funds. Only after you’ve done this can you move forward with growing your investments.

Set a Budget

Setting a budget and sticking to it is an exercise in discipline, but it’s also an essential step to financial freedom.

We recommend going through your list of monthly expenses and checking which items you can cut down. List down your fixed expenses and variables then go from there. However, with the price of goods fluctuating constantly, you may want to add a 10-20% buffer as a contingency to these prices.

Another common technique that people use when creating a budget is the 50-30-20 rule. The 50-30-20 rule is as follows:

• 50% of your income goes to needs.
• 30% of your income goes to wants.
• 20% of your income goes to debt repayment, savings, and investments.

Although, keep in mind that this formula may not work for everyone, especially if your income lacks wiggle room. So, you can customize these numbers to make it work for your income.

Finally, setting a budget is not a one-and-done activity, you’ll need to reevaluate it every couple of months to account for inflation and any changes you may have in your financial status.

Automate Savings

One of our best tips on how to save money from your salary in your bank is to automate your savings.

Some banks have a feature where they automatically transfer your funds to another account. You can utilize this feature to make it harder for you to spend your money and secure your savings funds.

Basically, if you can’t see it, you can’t spend it.

Resist Temptation

When you see an item you like, you must exercise discipline and patience to avoid the impulse to purchase it – especially if it’s not in your budget.

For any purchase, make sure that you stick to your budget and that you buy it only when you can. For luxury items, make sure to stick to the golden rule of, “Purchase luxury only when you can buy ten of it.” That way, you can focus on buying practical pieces that won’t break the bank while you’re building your wealth.

Avoid Bank Fees

Late fees for credit card charges, interest rates, and ATM transaction charges. These may be small charges, but over time you can notice that they can rack up quite an expense.

This is why you should pay your bills on time. ATM fees can also be avoided by planning your transactions and making sure that you only go to your bank’s ATM.

Make Your Money Difficult to Access

A great way to save money is to make it more difficult to access. Put your money into separate accounts, like sinking funds, to make it harder for you to access and harder for you to see how much you have in total.

If you have money that you’re saving for long-term goals, consider investing it into a time deposit. A time deposit is a good investment tool that locks off your money for a certain period as it earns at a higher interest rate.

Explore Other Earning Opportunities

Increasing your income streams can help you save more for your future. You can consider taking odd jobs or looking into different investment vehicles for your money. However, you should only look into different investment vehicles if you’ve already paid off your debts and built your emergency funds.

Investing can give you the opportunity to have a passive income, allowing your money to work for you. Depending on your risk appetite, there are various investment opportunities you can choose from. For those who are conservative, you can look into time deposits and UITFs as an investment vehicles.

Treat Yourself

An essential part of the saving process is to treat yourself. Seems counterintuitive, huh? While it may seem that way, it’s helpful to treat yourself every now and then.

Enjoying the fruits of your labor allows you to stay motivated in your goals. Rewarding yourself for your discipline is key to reinforcing good spending habits.

Just make sure to spend within your limits when you treat yourself.

Find a Bank That Can Help You Reach Your Goals

Finally, you should find the right financial institution to help you attain your goals. A bank that has the right tools and products to help you secure your future and enjoy your present – just like RCBC.

With RCBC, you gain access to many investment opportunities and financial tools. For example, RCBC’s online banking app allows you to manage your savings, transfer funds, and open new RCBC time deposit contracts.

If you’re ready to take the next step in your financial journey, open an account with us at RCBC today!