3 Step Saving Plan To Fund Your Big Purchase
If I were to ask you, what’s the travel destination of your dreams, what will your answer be? While our answers may be different, the fact that we need to fund our travel plans wisely remain constant.
Having mentioned that, be it planning the travel of your dreams or buying that car of your dreams, learning to fund your big purchases is more important than you think. And that’s what we are here for!
In this article, we shall talk about a 3-step-saving plan for you to fund your big purchase without any hassle. With these financial tools at your disposal, the process of funding your big purchase will seem a lot easier to you and put you at ease in those dreadful times of budgeting.
Without any delay, let’s dive into the tips!
1. Opt for A High-interest Savings Account
Adulting is difficult, we get it! But achieving your goals need not be that difficult.
We have a solution for you: open a high-interest savings account. Why, you ask?
Saving your money in a high-interest savings account not only saves your income but also provides additional interest to your deposits. So, every time you deposit any amount of money to your savings account, you get extra money just for choosing to deposit it. Sounds cool, right? That’s because it is!
This further helps you to save regularly and eventually, leads you to your goal of funding your big purchase.
JumpStart Account is the ideal place to start saving up for your big purchase. Learn more about it here.
2. Do the Right By the 80:20 Rule
Yes, it’s as simple as it sounds! No complications attached.
Save 20% of your salary every month while keeping 80% of your salary for your monthly expenditure, both for your needs as well as wants.
But while you are at it, know that there is a difference between needs and wants. Out of the 80% of your salary allocated to expenditure, it’s ideal to keep 50% for your needs and 30% for your wants to budget well.
But how do you differentiate between your needs and wants?
While needs constitute your necessities like the expenditure on food, clothing, housing, and shelter, wants constitute the items of luxury that you might desire from time to time. From a high-end luxury handbag to an expensive perfume, it could be anything.
Once you start following the 80:20 rule by saving regularly, you not only fund your big purchase in a timely fashion but also save up for your rainy day fund.
Additionally, do you want to know an in-depth step-by-step process to inculcate the 80:20 rule into your financial lifestyle? Read more about it here.
3. Meet Math, Your Perfect Match!
Have you calculated the exact amount you require to save to fund your big purchase? Well, it’s high time you do.
Begin with getting to know your ideal amount and divide that amount by the number of months you wish to save to fund that purchase. After this phase, you’ll have a good idea of how much money you’ll need to save each month. Once you’ve figured it out, make sure you’re putting aside that amount every month to attain your goal.
Let’s understand this with the help of an example, shall we?
Suppose you have your international trip planned in about 18 months from now and it will cost you nearly $18,000. Simply divide the total amount of $18,000 by 18 and you will get the answer of $1000. This is the amount you need to save every month to fund your big purchase in a timely manner.
Now, we are not saying that it will happen in the blink of an eye, it requires patience, time, and continuous effort but you will get there, eventually!
Keeping that in mind, do the math right for every big purchase coming your way and witness the process of funding them becoming a lot easier.
Saving the right amount of money and inculcating that as a lifestyle habit is an art in itself. No matter what stage of life you are in, learning to fund your big purchase is something that you cannot escape, neither now nor ever,
Not just this, even investing your salary helps you a great deal in funding that big purchase as you also get a step closer to achieving your next life goal. Read this article to know more about it.
This article is brought to you by Standard Chartered Bank (Singapore) Limited. All information provided is for informational purposes only.