Revealed: A simple yet efficient guide to saving wisely

Financial prudence, or the careful management of available funds, is a prerequisite – experts argue – for financial wellbeing and stability.

This concept has been underscored by the recent Covid-19 pandemic, which brought to the fore, the significance of spending money wisely.

The six saving tips listed below, shared by the UAE’s Ministry of Finance, may just be a modest start to what is warranted on cultivating financial habits to secure the future.

1. Open a savings account
Perhaps the simplest step of all, opening a savings account and deciding the portion of income you’d like to stow.

As a general rule of thumb, most individuals save 20 per cent of their income and adjust upwards accordingly. With situations, such as the ongoing pandemic, it would be wise to save a larger percentage.

2. Use your credit card wisely
Retail indulgences often lead to a stack of credit card bills that need to be dealt with, ideally on a timely basis. Hence, it would be prudent and beneficial to use plastic money wisely.

3. Set a monthly budget
To limit monthly spending, you can place cap on your credit and debit cards. There are also numerous apps, which can help you track purchases and notify you when you get close to or exceed the set monthly target.

4. Spend less and save more
With many methods to cut spending, the final choice is based on your personal preference and the ability to exercise discipline.

For example, the removal of credit card numbers from online stores and payment apps could help reduce the temptation of unnecessary spending.

5. Affordable home and car insurance
Instead of hopping on the bandwagon and purchasing insurance with popular providers, one should explore the market to find more cheaper and suitable deals that accommodate your budget.

6. Master the 30-day rule
When it comes to making large purchases, time is the most vital component of the process.

Be consistent in taking a full month to contemplate large purchases which need to be budgeted and could possibly require a small portion of your savings to cover the cost.