Get ready to maximise your potential, maximise your living with empress2inspire’s new posts series “Daily Dose of Living”. These series will bring you the best in personal development and productivity every day of the week. Your best life awaits.
In today’s post we will learn about how and why it is important to build a money cushion in the bank. It makes more of a difference than you might think. Building up a cushion in my bank account isn’t a complicated concept: instead of having just about exactly what you need to pay my bills (and transfer for savings), and then getting down close to no money after all the payments are made and transfers completed, decide to try to have a larger amount in the account, even after the bills are paid. Building a cushion helps create a sense of security, knowing that in addition to my emergency fund, there’s money in the bank in case a bill is automatically deducted without my realizing it.
How to do it? Here are some suggestions :
- Cut expenses – See what expenses you’re paying now that aren’t absolutely necessary, or what can be reduced. Look at the big things, like house and car and food. Look at the little things, like magazines and music and clothes and coffee and dessert.
- Budget – With a budget, it’s easier to see what you can cut, what’s necessary, and how to put a little extra aside for the cushion. It’s also good because then you know how large your cushion needs to be in order to pay all your bills at once.
- Emergency fund – As long as you don’t spend the entire amount when you pay your bills at the beginning of the month, this is an easy way to get to that cushion quickly.
- Pay bills all together – Set a day when you plan to pay all of your bills, go online, make the payments, transfer your savings deposit, and then withdraw your cash if you use the cash method.
- Use last month’s income for bills – It’s a beautiful thing, knowing that you’ve got enough for more than a month’s expenses sitting in your bank account. Your finances couldn’t get much simpler.
Here are some tips to eat better on a budget > https://empress2inspire.blog/2020/11/01/tips-to-eat-better-on-a-budget-part-1/
Come back again tomorrow for more inspiration.