If there is one important lesson the recent global pandemic has taught us Filipinos, it would be that we can live with just what we need instead of what we want. This means prioritizing necessities instead of luxuries could help us incur fewer costs and generate bigger savings.
A frugal lifestyle is not popular and appealing to most of us. However, it is the kind of living we need especially these days when inflation remains higher and most of us are still in the stage of recovery from the financial burdens and setbacks brought about by the unexpected and long Covid-19 pandemic.
Do you intend to save a huge amount of money for an overseas vacation you have been aspiring for several years? Or do you need to generate a sufficient amount to make a significant investment or better yet, start a new small business?
While banks are now getting more aggressive and persuasive in offering attractive loans, debt is still something financial experts will warn you about. And we all agree that it is always best to spend savings than a borrowed amount that incurs interest and other charges over time.
Setting a financial target
Frugal living would be more purposeful if you would set a specific amount that serves as your target for generating savings. If you plan to spend ₱100,000 to invest in the stock market or put up an online-based small business, how much should you save in a high-interest-yielding digital bank for 6 months, a year, or 2 years?
Worry no more about accurate and quick computations. Let’s begin by using the Savings Goal Calculator, a helpful online tool that helps figure out how much an intended amount of savings can grow or how much time you need to save the target amount (if you would allocate a fixed savings amount per month).
Click here to open the Savings Goal Calculator in your browser. Key in your savings goal and your current/starting savings (if there are any). In the interest rate field, you may choose from 2% to 4% depending on the specific savings interest offered by banks (there are digital banks and e-wallet savings accounts that offer up to 4% annualized percentage rate (APR).
Put the number of months you intend to save to reach the goal. Click ‘calculate’ to determine how much you need to save monthly during the specified time. You can readily replace the ‘months to save’ field with various intended number of months to save until you determine the best figures that would be feasible and doable given your current financial status.
Now that we set the financial target and the duration to save, it is time to live frugally to lower expenses and generate target monthly savings. Here are some practical and logical tips.
Save on meals
Do you usually dine in at your favorite restaurant or fastfood chain for breakfast, lunch, or dinner? You could save about ₱500 to ₱1,000 daily if you opt to cook at home and pack your meals when you go out to work at the office.
How about opting for 3-in-1 instant coffee drink during coffee breaks instead of dropping by Starbucks? You can save up to ₱300 per coffee cup if you opt to go instant. Fortunately, there are numerous options for instant coffee available locally. All you need is to explore and find the best instant coffee that can be a good alternative to your favorite Starbucks drink.
Save on transport costs
Instead of bringing a car when reporting to the office, how about taking public transport? These days, you will be surprised that it may not be a bad idea as you think. You can take the MRT/LRT rides or EDSA Carousel bus rides going to your destination instead of booking a ride from a popular car-hailing app, which usually charges about ₱300 to ₱900, especially during rush hours.
How about trying to ride a bike going to work? It would not incur any cost. There are bike rentals around the metro as well if you don’t have your own bike. Taking a walk for several minutes would be a healthy exercise if you live within walking distance from the office.
Save on utilities
You can trim down your monthly electric bill by being more conscious about your energy usage at home. Turn off and unplug all appliances that are not in use. Lessen your airconditioner use by opting to use the electric fan more often. Set your refrigerator control to a minimum or medium.
Conserve water by using it more intelligently. Do your laundry weekly or every two weeks instead of daily or every other day. Take quick showers instead of taking too long when taking baths. Have leaking pipes and faucets immediately fixed to avoid water wastage.
Ditch your cable TV plan for good and instead, take advantage of content streaming platforms online, which are usually free of charge. The landline phone may not be a necessity anymore as everyone can now be reached via mobile or free Messenger apps. Settle for low mobile phone service plans that offer free calls and texts to all networks and free data of up to 6GB monthly at a lower monthly plan cost.
There are many other creative ways to save on costs and lower monthly expenses. Make frugality your way of life and enjoy the huge savings you can generate by living within your means. Just remember not to deprive yourself of the simple but important things in life. Happy saving!
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