Saving money is the key to achieve financial stability in the future. However, many people find it difficult to save due to certain factors. Various methods of saving money are then growing and make it easier for someone to save their money.
Here are three unique saving methods from various countries that you can apply to form a saving habit.
1. Envelope System
Envelope saving was originally widely practiced in the US and Canada. The first step starts with creating several budget categories such as daily shopping, body care, household supplies, lifestyle, also savings and investments.
Each category has its own envelope (or similar container) which is then filled with cash as needed. This method makes it easier for someone who finds it difficult to save as long as they are committed to using the money based on its category.
The envelope system is now often adopted by a number of digital financial applications so that the financial budgeting process becomes more efficient.
2. Hui
Hui used to be practiced by Chinese immigrant communities who wanted to start a business. Members of the group would meet and collect a sum of money of equal value each month, and then draw lots to see who would get the total for that month. The lottery will continue until all members have had their turn.
In Indonesia, hui is known as "arisan" (an informal loan club). Some other countries also use it with different local names. Keep in mind that hui or arisan should be done with a trusted community or group of people. Many scams under the guise of hui are spread online.
3. Kakeibo
Kakeibo literally means "household financial records". The principles are to value money, keep track of all cash flows, avoid debt, and be frugal.
The four budget items in this Japanese saving method include essentials, optionals, entertainment and extras. Savings and investment funds can be included in the essential items to encourage long-term financial prioritization. It also makes savings and investments as important as other primary needs.
Specifically, there are some kakeibo tips to take note of:
Set an amount of money to save at the beginning of each month.
Wait 24 hours to think about buying non-essential items.
Transact with cash to be more aware of the amount spent.
Reflect and evaluate at the end of the month.
No matter how you save, make sure there is an allocation for investment!
Investment can help us in many ways, from overcoming inflation to achieving financial freedom. Let's optimize the value of savings by investing in stocks with KAF Sekuritas.
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Disclaimer: The content is made for educational purposes, not a recommendation to buy or sell a particular stock. PT KAF Sekuritas Indonesia is licensed and supervised by the Financial Services Authority (OJK).
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