Let's admit it:
Saving money is not the easiest or most fun thing to do, well at least not for most people. There's so many things to try out, to experience and to buy, like supporting the latest product your aunty's selling, or just succumbing to the whim of your partner that he or she has been trying to talk you into lately. And with bills from last year's wedding! What can be saved, really?
Although it sounds insurmountable to most, there are people who have done this steadily.
Here are 5 steps you can take to save $100k (in your local currency) by 30 years old.
1. Spend on what you need, and save the rest
The rule of saving a percentage of your take-home salary, say 20%, is a good start. But to really achieve an amount significant as $100,000, you need to do the opposite: spend on only what you need, and save up the rest. Yes, every ringgit or dollar that remains. It is okay to spend on big items once in a while - as they are needed - but the discipline is to spend only on what you absolutely need, such as food, transportation and maintenance of things that needs to be repaired or replaced.
If you keep this as a habit, then you'll soon find your nest growing more than even you realise it.
2. Understand your spending pattern
Everybody appreciates certain things that are a bit different than the person next to them, so it is crucial that you make it a conscious habit in the first 10 years when entering young adulthood - as early as the age of 18 - to keep track on where all your money goes. This can be quite time-consuming because it involves keeping track of absolutely every cents of what comes out of your wallet and e-wallet.
But after ten years or so of doing so, you'll soon get a good grip on how your spending pattern works, which allows you to work out where all the small and big items go. Once you establish such a habit, it will become natural for you to determine when a situation really calls for you to spend on something - or not.
3. Invest - in knowledge!
When it comes to growing your money, there are a lot of tips on investment and wealth management out there. But what you must know that most people do that tip sharing for a "living", and it is not always true that such investment or wealth management can be generalised to everybody or is even what you need. You have to invest in knowing what works for you. For example, investing in stocks had been a great place for people to grow their wealth, but many have also lost of their wealth from the same place. Investing is more than figures - it is also about timing, partnerships and trust. There are many bogus investment schemes out there nowadays, and it is your responsibility to find out what is the framework of any investment schemes before getting yourself into it.
The best rule about this is, never give into greed. Take time to learn, whether it is an investment that you want to be part of. High returns do not necessary guarantee good outcomes - the money you put in could be used to support hot-money industries or environmentally-damaging corporate activities that will not lead to a better society - hence economy - in the future.
Every dollar vote counts!
4. Never take out a loan
Always strive to be debt-free, no matter how tempting something might be for you. It can be a new car, or a student loan to further your studies, or just a personal loan to upgrade that speaker system you've long dreamt about. It is always better to use only what you have, and always work with it. Sometimes there can be situations that are uncalled for where loans are necessary - if that's the case, then try to pay it off as soon as possible. Regardless of what it is, it's never worthy to take out a loan, because the interest that you'll be paying for the loan will be eating into your wealth, deeper with longer tenure.
As to 'investment' that you can only make possible through loans, such as 'investing' in property or any types of businesses where you need to borrow - know that you can't really 'invest' in something until you really own it 100% - where you can pay in absolute cash.
5. Ensure a positive cashflow every month
Whether you're studying or working, this step is absolutely essential: always ensure that there is a positive cashflow at the end of the month. That is, only spend less than what you earn that month. If you're studying, always get a part-time job. If there're certain periods of time where there'll be no income streams, that's okay, but make sure in those periods cash outflows will be kept minimal to only survival items, and in general on what you can really afford.
On average, every month should turn out with a positive cash flow.
Whether such step will invovle re-negotiating your salary, down-scaling your lifestyle, making your business more productive, or dropping down everything to retreat in the forest: always keep a positive cashflow - or at the very least, a very neutral one.
Conclusion
If you are a decent person that actively works or actively finds work once the previous one ended, follow these steps and watch the miracle of your account grows into 6 figure by the time you reach 30!
Although it sounds insurmountable to most, there are people who have done this steadily.
Here are 5 steps you can take to save $100k (in your local currency) by 30 years old.
1. Spend on what you need, and save the rest
The rule of saving a percentage of your take-home salary, say 20%, is a good start. But to really achieve an amount significant as $100,000, you need to do the opposite: spend on only what you need, and save up the rest. Yes, every ringgit or dollar that remains. It is okay to spend on big items once in a while - as they are needed - but the discipline is to spend only on what you absolutely need, such as food, transportation and maintenance of things that needs to be repaired or replaced.
If you keep this as a habit, then you'll soon find your nest growing more than even you realise it.
2. Understand your spending pattern
Everybody appreciates certain things that are a bit different than the person next to them, so it is crucial that you make it a conscious habit in the first 10 years when entering young adulthood - as early as the age of 18 - to keep track on where all your money goes. This can be quite time-consuming because it involves keeping track of absolutely every cents of what comes out of your wallet and e-wallet.
But after ten years or so of doing so, you'll soon get a good grip on how your spending pattern works, which allows you to work out where all the small and big items go. Once you establish such a habit, it will become natural for you to determine when a situation really calls for you to spend on something - or not.
3. Invest - in knowledge!
When it comes to growing your money, there are a lot of tips on investment and wealth management out there. But what you must know that most people do that tip sharing for a "living", and it is not always true that such investment or wealth management can be generalised to everybody or is even what you need. You have to invest in knowing what works for you. For example, investing in stocks had been a great place for people to grow their wealth, but many have also lost of their wealth from the same place. Investing is more than figures - it is also about timing, partnerships and trust. There are many bogus investment schemes out there nowadays, and it is your responsibility to find out what is the framework of any investment schemes before getting yourself into it.
The best rule about this is, never give into greed. Take time to learn, whether it is an investment that you want to be part of. High returns do not necessary guarantee good outcomes - the money you put in could be used to support hot-money industries or environmentally-damaging corporate activities that will not lead to a better society - hence economy - in the future.
Every dollar vote counts!
4. Never take out a loan
Always strive to be debt-free, no matter how tempting something might be for you. It can be a new car, or a student loan to further your studies, or just a personal loan to upgrade that speaker system you've long dreamt about. It is always better to use only what you have, and always work with it. Sometimes there can be situations that are uncalled for where loans are necessary - if that's the case, then try to pay it off as soon as possible. Regardless of what it is, it's never worthy to take out a loan, because the interest that you'll be paying for the loan will be eating into your wealth, deeper with longer tenure.
As to 'investment' that you can only make possible through loans, such as 'investing' in property or any types of businesses where you need to borrow - know that you can't really 'invest' in something until you really own it 100% - where you can pay in absolute cash.
5. Ensure a positive cashflow every month
Whether such step will invovle re-negotiating your salary, down-scaling your lifestyle, making your business more productive, or dropping down everything to retreat in the forest: always keep a positive cashflow - or at the very least, a very neutral one.
Conclusion
If you are a decent person that actively works or actively finds work once the previous one ended, follow these steps and watch the miracle of your account grows into 6 figure by the time you reach 30!
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