Want to check your balance? There’s an app for that. Want to calculate your mortgage repayments? There’s an app for that. Want to pay a bill? There’s an app that too.
Today, just about every financial transaction can be managed online or via your mobile and old-fashioned saving techniques seem just that – old fashioned.
Who remembers drawing money out of the cashpoint to last you all week? Queuing up to speak to a cashier about an overdraft or writing cheques? The world of personal finance has transformed completely over the past decade.
As the global financial crisis has shown, sometimes the new ways aren’t always the best ways. We may scoff at our grandparents putting money in envelopes and going to the post office to pay the bills but what was so wrong with that? They were rarely in debt, rarely lived outside their means and rarely relied on credit.
Yes, the economy has always dipped in and out of recession. But this latest, and longest recession has been caused by an over-reliance on credit, by people unable to pay it back.
So what are five old fashioned money saving tips that can we learn from our parents or grandparents when it comes to saving in today’s modern world?
1. Save, save, save
You don’t have to hide your money under a mattress – just put a little aside each month and you will soon start to grow a nice little nest egg. There is truth to that old adage ‘look after the pennies and the pounds will look after themselves’. Set up a small transfer into a savings account and you will soon start to view that as just another regular payment.
2. Seriously, control your budget
This means keeping track of what you’re spending and not buying things you really can’t afford. There’s no harm in using technology to log and manage your spending, there are loads of free apps designed to take the hard work or logging all your transactions down for you such as “Expense Manager” – or you could just write it in a notepad, it doesn’t really matter. The key is that you identify what is a necessary spend and what is a luxury and keeping track of what you’re spending and what you’re spending it on.
3. Make cost-effective choices
There are many bargains and budget items available these days and occasionally you will come across a real find or something you desperately need at a knock-down price. Think about quality over quantity because sometimes it pays to spend a little more, get better quality and have longer-lasting items.
4. Paper or plastic?
If you asked them, you may find that your grandparents probably never had a credit card, especially in their younger days. Love them or hate them, credit cards are here to stay. Now if you use it wisely, pay it off every month and opt for one which gives you cashback, a credit card can actually be a great addition to your financial portfolio. However; using it as free money will only land you in trouble, so be wary about what you’re buying as you’ll soon start to mount up your debts.
If you find yourself falling into the latter category then either cancel your cards or leave them at home.
5. Recycle & reuse
Back in the day, people were much more creative about how they used the things they had to hand. Your granddad may have stored his tools in old shoeboxes, and the chances are that your grandma had a jar full of buttons. Not everything needs to be brand new and purpose-built. And recycling websites can be great as you can find things others no longer need but don’t want to throw away. These are often free and are a great way to find what you’re looking for at no extra cost.
What you will notice most about these tips is that they require a mindset or habit change if they are to work successfully. Going back to basics doesn’t mean getting rid of the technology that makes life simpler it just means not overlooking tactics which previously worked for others in the past.