It might seem like a good idea to dip into your savings account when money is tight. However, if you do this too often and take too much money out of your savings account you might prevent your savings fund from growing and will not make any progress towards your financial goals.
Here are ways to prevent you from dipping into your savings account and help you save even more:
Have an emergency fund: Your monthly budget might be airtight; however, there are always unexpected costs that creeps in – especially at the end of the month when you are almost out of pocket. Establish an emergency fund to cover these unexpected expenses. This is separate to your savings thus, make sure that either you stick with not spending this set amount or open a separate account in which you deposit a certain amount of money every month specifically for emergencies.
Switch to cash-only: Set up debit orders for your fixed bills and expenses and use cash for the rest. This way you will think twice before over-spending as you will only have a certain amount of money with you. Just make sure that you do not draw more than you have budgeted for and that you draw at a safe ATM.
Adjust your budget: If you have to constantly dip into your savings then it means that you are overspending. Take a look at your budget or draw up a budget if you do not have one yet, and cut unnecessary expenses. Here is a short video on how to compile a budget: https://bit.ly/2YdfEeO. Remember that Iemas offers free financial workshops at employers that has a contract with Iemas. Find out more: https://bit.ly/2JevW3K
Find a savings solution that works for you: Iemas Insurance Brokers an authorised financial services provider (FSP 47563) and wholly owned subsidiary of Iemas Financial Services, offers a range of savings products to suit your needs. From savings plans, investment plans to retirement annuities, we have a variety of solutions to secure your future! Contact us on 0860 102 383 or visit Iemas Insurance Brokers.
Adapted from: https://www.thebalance.com/how-to-stop-using-your-savings-account-2386112