Saving your hard earned cash 💸
From a young age, I've been on a quest to make and save money.
From vacuuming the house for a fixed "fee" so that I could get a MacBook to working a few jobs in university to have a little extra pocket money. I was so excited when I started my internships because I finally had a steady stream of income.
However, I quickly fell victim to lifestyle inflation - this is when we start making more money, so we start spending more money. All of a sudden, I had a new title at work - did this mean I had to dress nicer? What about that new designer handbag and those nice loafers I'd been eyeing? Or going for coffee and dining out more frequently?
Don't get me wrong, I'm a firm believer in "treat yourself" but it's so important to draw that line between a one time purchase and lifestyle augmentation.
By the time I started full-time work, I knew I wanted my relationship with money to be different - like many other aspects in my life, I wanted to be more intentional and mindful with what I was spending money on.
I started tracking my expenses the semi old-fashioned way - on Google Sheets by date, category and amount. I had a summary section where I would compare my monthly spending to my salary to see what percentage I was saving and spending.
Obviously there are emergencies and big events that pop up ($2300 wisdom teeth removal? 🙋🏻♀️) but I'm so proud to say that I've been able to save 90% of my salary since starting full time work in October 😊 I've put together some of my guiding tips and techniques but by no means am I a financial expert so please do what fits your situation.
Why power + goals
It can be demoralizing and demotivating to save up when you don't know what you're saving for or why you're saving. At the top of my aforementioned Google Sheets spending tracker, I wrote out a few of my goals to keep in mind and while I'm filling out my expenses, one of the columns I have to answer is whether that cash outflow aligned with my goals.
I have had times where I've made a purchase that didn't align with my goals (i.e. impulse buying or online shopping), and that's okay - the goal is just not to make that a habit.
If you don't know what your goals are, start simple with "Retire by 65" and as you get more ideas of what you want your ideal life to look like, you can build from there. They don't all have to be financial as you can see from the ones I have on my tracker.
Additionally, I found it very helpful to have specific dollar-value targets that I wanted to achieve by the end of the year so that I would be more motivated to hit that number - even if it was more than my minimum biweekly savings goal.
Look for multiple sources of income
If you're like me and want to reach your goals faster and you're cutting your expenses the best you can, there's only one more option: to grow your income.
Now while most of us are probably not in a position to negotiate higher salaries, there are additional sources we can look to.
Side hustle: If you have a side hustle (illustrations, baking, blogging, thrifting, photography), find a way to monetize it! There's nothing better than being rewarded for your creativity and hobbies
Marking: I personally mark exams and assignments for graduate courses at the university I graduated from. Not only do they pay well but also helps me keep my technical knowledge fresh!
Teaching: I've heard of lots of tutoring websites (Chegg, TutorBright) where you can offer up your expertise and teach to kids on your own schedule and hourly rate.
Declutter: Deep clean your space and see what you're not using that could potentially be of value and use to someone else! I've used Carousell, Bunz and Kijiji in the past to get rid of some of my gently used items.
Find ways to do your hobbies for less
When I tell people that two of my passions are traveling and saving money, I'm often given strange looks. While I do agree that traveling does mean spending money, like with all purchases, there are ways to be smart and save money while doing it.
Once I had my goals established, I knew that traveling was a part of who I was and what I enjoyed - I wasn't ready to just cut that out in order to save money. So instead, I look for the best times to travel (off-peak), as well as look for deals on flights, hotels and activities.
Yes I paid $500 to stay one night at the Marina Bay Sands in Singapore - but it was one night and what people don't realize is that I stayed at hostels (often $30 CAD per night) for every other night of my 2 week trip.
Instead of taking Ubers or taxis, I opt for public transit as it is often much cheaper and a great way to get a feel of the city.
Instead of dining at fancy restaurants for all 3 meals, I'll check out the local grocery store and see what interesting deals and meals are available (if you're going to 7/11 in Japan, spoiler: A LOT).
This doesn't just apply to travel - but for any hobbies. For example, I love doing yoga but do I want to spend $30 on a class?
Maybe one day but not right now, so I opt to pull out my yoga mat and jam to some Yoga With Adriene on YouTube instead. (😍 love you Adriene)
Do your research
There's nothing worse than impulse buying something and realizing it's not what you expected, and that you just wasted your money.
This is where the power of research comes in. Before I buy anything material, there have been solid weeks and months of research behind the purchase. Whether this be comparing against similar brands and price points to watching YouTube reviews, I don't want my hard earned money to go to waste and neither should you.
Oftentimes, this also serves as a way for me to see if I really want something. For example, If I see these really nice high waisted dress pants on someone, I'll search up some stores and see which ones have a similar style. But if I find that I'm not even thinking about it the next day or week - how much do I really want them?
I recently bought a standing desk from Ikea which was a whole research project in itself. Ever since I started my first internship in 2016, I knew I eventually wanted a standing desk but I was never in one location enough to justify buying one. Now that I've been working at home since March, I really wanted a workspace where I could have the option to stand or sit.
After heavily considering all my options, reading reviews, watching videos, I'm so happy with my purchase because I knew exactly what I was getting myself into and I knew that it was something I had really wanted! (4 years in the making!)
Cost per use
Cost per use is my favourite metric to estimate when considering buying something. In addition to endlessly researching (mentioned in the step above), I calculate how much it would actually cost me to use that item.
For example, I bought the Adidas Ultraboosts in 2017 for about $230 after tax which seems so absurd since I literally just wanted them for walking (I'm not really a running type).
BUT I wore them to over 20 countries on my semester abroad and still (in mid-2020) wear them everyday. So between mid 2017 and mid 2020 is 3 years, and excluding 4 months each year for winter gives us 735 days, which means that it cost me $0.31 per day to wear the shoes.
This is much more reasonable for me than having multiple pairs of shoes that I wear occasionally - if I like something, I'll use it as much as I can.
Another example can be applied to my grade 12 prom dress - I bought a $330 BCBG dress which seemed so expensive at the time, but I knew it was timeless and a classic that I could rewear. As a result, I've worn it 3 times - to my grade 12 prom, to a Christmas party and to my Grad Ball - coming to a cost of $110 per wear.
This is still a bit steep in my opinion, but I know that it's a dress I'll continue to wear for special occasions. Although I could've gone out and bought other dresses, the point is that I also want to own less things, which is why I would rather buy something of quality (usually pricier).
So the next time you're thinking about a purchase, no matter how big or small, think about the true cost based on the frequency of use.
Don't deprive + Concluding thoughts
The point of this post is not to encourage deprivation - if you keep telling yourself no, you'll just feel miserable. Remember: it's not about the destination, it's about the journey. Sure, saving up all this money to one day sit on sounds nice, but if you get there with so much resentment and disappointment that you missed out on life - is it worth it?
My personal views are not to get to a certain dollar value but rather to have financial freedom.
Freedom to make choices and take risks knowing that I'm financially stable.
Freedom to spend my time however I want, knowing my assets are still generating money.
But for now, we save, spend wisely and invest safely.
Sending you lots of love and light!
-Reina xo