How to grow the gap between your expenses and earnings

Do you find yourself spending more than you earn? If the answer’s yes, you’re not alone — most of us struggle to cut back on costs. But did you know that you can save money without even realising it?

Boost your finances by following our three-step guide.

1. Cut the cost of luxuries

Very often, the key to spending less is simple: reduce your unnecessary outgoings. Though this may sound extreme, it doesn’t mean going without your favourite treats — it simply involves swapping them for cheaper alternatives.

Say you like to regularly indulge yourself with a take-out coffee. You could easily trade it for a home-made brew in a flask, using premium quality coffee from your local supermarket. Why not shop during the evening to benefit from bigger discounts? Make the most of stores that introduce offers towards closing time. Likewise, by buying in bulk, you stand to slash your outgoings even more.

2. Draw up a spending plan

It’s usually easier to complete a project if you have a plan to follow — and saving money is no exception. With this in mind, why don’t you create a bespoke spending forecast? Factor your saving goals into it, and you could massively decrease how much you spend.

To begin, list all guaranteed and potential outgoings for the next month, before weighing these against your projected earnings during that period. As you’ve swapped luxuries for cheaper alternatives, you’ll likely find that you have more coming in than going out.

Follow your cash flow consistently, and you’ll soon get used to spending less than you earn. Who knew all it took to achieve this was a little financial planning?

3. Beat the temptation to overspend

Let’s face it, it can be tempting to overspend — even if we’re following a spending plan. But you can beat this urge by noting down why you want to save money.

Are you building a fund for something special, for example? Or do you need to make a big, crucial payment? Whatever it is, add it to your cash flow document, and you’ll be reminded of it whenever you look at it.

If you know your overspending weaknesses, why don’t you pinpoint when you’re most likely to be hit by them? You’ll then be able to install saving alerts onto your phone for that particular time of day, to remind yourself of how well you’re doing so far — and not to give up!

Spending less than you earn doesn’t have to be as tricky as it sounds. With a bit of research and some handy organisation, you can easily lower your expenses and increase how much of your income is left over at the end of each month.

*This is a collaborative post*