10.Saving € 000 in one year sounds impossible? We’ll tell you how to do it anyway, thanks to a simple financial plan.
- · Saving with a plan
- · Step 1: The inventory
- · Step 2: The budget
- · What may rent& Co. COST?
- · Calculation example: Fixed costs
- · Step 3: Realistic limitations
- · Step 4: Reduce fixed costs
- · Step 5: A Challenge
- · Step 6: Increase your income
- · Conclusion: You can save even more than 10.Save € 000
Maybe you’ve been dreaming of a certain trip all your life, or you want to buy a new car, maybe you’re even saving up for a down payment on your dream home.
Almost everyone has something they want, but always put it off because their finances just don’t fit with their dream. But you don’t have to wait until your salary has finally doubled or until you win the lottery against all odds. You can also make your dreams come true right away – or at least start paving the way for it.
Save with a plan
Unfortunately, many people have never learned the right way to handle money. This does not necessarily mean that they are mishandling their money, but rather that they are simply not handling money at all.
In other words: they spend their money haphazardly. If you ask people how much money they spend on food each month, only very few have a concrete figure in mind. They only know that at the end of the month their income is mostly completely gone. And when they take in more, they usually spend more right away, too.
The good news is that this behavior can be corrected with little effort and almost no sacrifice – and that alone saves a lot of money. We show you 6 steps to reach your savings goal in just one year!
Step 1: The inventory
Before you can start saving a specific amount, you need to know how much money you already have available each month. So you need to know exactly how much you are taking in and how much you are spending.
A rough estimate is not enough either. It must be a precise list of all your expenses and income. The more accurate it is, the better your savings plan will be.
The classic way to do this is to keep a Budget book. There you enter your monthly income and other income or allowances. Then you write down every expense you make.
The easiest way to do this is to always use the Receipt raises. So at the end of the day you can transfer all expenses at once and throw away the slips of paper only when you have done so. So also nothing is forgotten.
If you prefer to enter something like this immediately, you can also use an app for it. Since you usually always have your cell phone with you, this can be a convenient solution.
Tip: The App ‘Wally has a user-friendly interface. You can enter all expenses and assign them to categories at the same time. The app will then calculate how much you have spent and if you have set a budget, the app will also warn you directly if you spend too much.
Step 2: The budget
Once you know how much money you have and how much money goes out, you can also set a monthly budget. By 10.000 €, you would have to set aside 833,33 € every month.
After taking stock, you can see if there is already some money left over each month. Some may not have any money left at the end of the month, but others may spend less than they earn, even without saving.
What may rent& Co. costs?
If you want to save money, you have to start with your fixed costs. Here we calculate 30% of the net income for rent including utilities and 15% each for food and transport.
The fixed costs should come to 60% of the monthly budget. The remaining 40 % are left for leisure time, retirement provisions, clothing and more. Here you can decide for yourself how much you want to spend on which items, or if you can even do without new clothes for a while.
Calculation example: fixed costs
If you calculate with a net income of 2.000 €, thus would have to cover 1.200 € is enough to cover fixed costs. This would leave 800 € for other expenses. The savings target would thus theoretically be reached, but of course no one wants to limit themselves so radically when saving.
Step 3: Realistic limitations
Therefore, even with the remaining 800 €, you again calculate a budget that can be used for leisure activities and others. This should be realistic for you.
As a guideline, however, you can 10% for fun expenses like leisure time and shopping and again 10 % for retirement provision take. With a net income of 2.000 € we would have a monthly expenditure of 1.600 €. This way, with little sacrifice, you would still save 400 € every month.
Possible savings per month: 400 €
Step 4: Reduce fixed costs
Of course, a good monthly budget is of no use if you can’t stick to it. So, for example, if your rent alone is already half of your monthly net income, then you need to reduce your fixed costs.
Of course, you could also give up the coffee to-go to balance the total, but with such small savings you won’t get far. You will only save really big amounts if you also reduce the really big items in your expenses.
This means: look for ways to reduce your rent to 30% of your net income. To remain with our calculation example: At 2.000 € income, a warm rent of 600 € would be okay. For people who live in big cities, this is often an impossible task.
If your rent is too high in percentage terms, of course you don’t necessarily have to lower the rent by moving to a cheaper apartment. Sometimes there is also the possibility to increase his income and so compensate the higher rent. So you could also sublet a room, or your garage or parking space.
Nevertheless, the fact remains: If you have to spend a lot of money on rent, you can save less.
Step 5: A Challenge
If you stick to your budget and don’t want to go without, a net income of 2.000 € thus on a saving of 400 €. Now, however, we have not yet exhausted the possibility of challenging yourself to save as much as you can. For this a No-Spend-Challenge is suitable.
Saving thanks to "No-spend-Month
With a "no-spend-Month you try for one month to spend as little as possible. That means no extras. No new clothes, no cab rides, visits to bars, restaurants or new decorative items for the apartment. This is also a good occasion to reconsider unnecessary subscriptions. Fixed costs such as expenditures for food, insurance or the like remain naturally nevertheless.
Admittedly: This is not an easy task, but since it is limited to one month quite feasible. Especially if you keep in mind that ideally you can save 20% of your income in the process! At 2.000 € so 400 €. Here too, however, one must of course remain realistic. If you find it very difficult, you can try to do without half of it. Even that would already be a great success.
Possible savings per month: 200-400 €.
Step 6: Higher income
The most effective way to save a lot of money is, of course, to increase its income. The more money you have available for the same expenses, the easier it is to quickly reach your savings goal.
So it is worth thinking about a part-time job. This could bring in an extra €450 every month. For self-employed or freelance workers even more.
Of course, this would also require more time, but when you think about the savings, it would be worth it for some people – especially since the extra burden would also only be for a year.
Another important point, however, is to save spontaneous extras. If you get money from your family for your birthday, you should not spend it right away, but save it as well. The same applies if you decide to sell old things. This income is also included in the savings target.
Possible savings per month: about 450 €.
Conclusion: You can even earn more than 10.000 € save
Who would not like a Nebenjob, it becomes with a net income of 2.000 € or less will be difficult to achieve its savings goal in one year. But even then you can get a lot out of your income:
- 12 x savings through fixed monthly budget: 4.800 €
- 1 x saving by No-Spend-Month: 200 – 400 €
- Total savings: 5.000 – 5.200 €
Each additional no-spend month naturally brings in another 200-400 €. If you do decide to take a part-time job, you’ll save that much more:
- 12 x income from side job: 5.400 €
So with this calculation, in 12 months you would have a whopping 10.400 € saved.