Saving money is arguably one of the most popular New Year’s resolutions next to losing weight. More than a quarter into the year might be a good time to evaluate how you’re doing so far and probably make adjustments if necessary. Savings is undeniably one of the basic concepts that every household should be able to understand and practically apply. Savings is basically the result of your net cashflow. Net cashflow is derived from cash inflow; money coming in, and cash outflow; money going out.

There are 3 possible ways to increase your net cash flow. First is to increase your income or, second, reduce your expenses but the best approach is to do both. And to do that, you need a lot of discipline and a drastic change of mindset. To earn extra income, you need to make your spare time productive. Making extra money doesn’t have to be grand. It just has to be effective enough and it should also work with your schedule. For working parents, who need to balance home and work life more, this is a real challenge, but I believe it’s possible. To lower your expenses, you need to cut down on unnecessary costs. You need to separate your wants from your needs – as well as those of your children’s. Get them involved in identifying essentials from passing fancies. This must be objectively done and try to avoid justifying unnecessary expenses for the sake of pleasure, especially that summer is here and there are lots of recreational activities calling our attention. However, it would be prudent to note that expenses based on whim just need to be controlled and managed but not completely eliminated. Furthermore, this is quite hard to implement unless you change your mindset.

If you’ve had a spender’s mentality for such a long time then you would always be naturally inclined to spend. Trying to save money without shifting to a saver’s mentality is like rowing your boat against the tide of the river. To change your mentality, you need to establish a healthy habit of consistent savings. Encourage your children and spouse to do so as well. Always start small and avoid being too ambitious. Do not worry if you’re even starting with a very small amount, say Php 100/month? Obviously the goal is to start with what you can afford no matter how small it may be. The most important thing is that you’ve started something. When you get the hang of it, try to gradually increase your savings until you hit the savings level you desire. Following a carefully planned and executed budget for the household could also help monitor your progress. From your budget, you can identify your needs and wants (which could vary from family to family) with surgical precision. Many parents would find this task too arduous but it is definitely worth it should the goal to increase savings be attained.

Nowadays, many households can barely make ends meet. Many people no longer save not because they don’t want to but simply because they really don’t think they can. Parents often use the usual scapegoats: “It is just too hard” or “I don’t have enough money to save.” But come to think of it, if you are having a hard time saving right now, do you think it will get easier in the future when prices of commodities have already risen? Actually, the circumstance of having a family and more mouths to feed makes saving even more urgent.

Another question that automatically puts you in the right frame of mind is: if you lose your job today, will you start saving tomorrow? The answer is a big yes, and why? Because you no longer have a choice! You will either reap the harvest for enduring the pain of discipline or suffer the consequences of regret. So, is savings really a matter of choice? Not if your family is important to you.

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