Saving

Save and Spend Wisely

Tips and tricks to spending and saving your money wisely.

Do not spend more than what you earn.

Always pay your credit card and bills on time to avoid late penalties. If possible, pay the full amount and be debt-free.

Build your assets through investments or takaful/insurance.

Only spend on necessary items.

Set a limit for splurges.

List out and prioritise your expenses.

Save for 'rainy days'.

Use coupons or reward points. Privilege and member cards may entitle you to discount benefits.

Learn to budget –and stick to it.

Learn the characteristics of financial scams to avoid it.

How to be Financially Smart

What is Financial Planning?

Financial planning involves:

Optimising your cash

Protecting your wealth

Growing your finances

Meeting your needs

Reaching your goals

Financial planning does not involve:

A drastic lifestyle change where you cannot enjoy life.
Being confined to a highly strict budget that spends only on the bare essentials.
Not allowing yourself to dine out so that you can maximise your savings.

Smart Money Habits

Saving

Always save with a purpose!

Only then can you figure out how much to save monthly to reach your target! Here are some examples of financial goals you can think about.

An emergency fund

Performing religious obligations, e.g. Hajj

Home ownership

Children's education

Travel

Retirement

*Reference: BDCB-CSPS Financial Literacy Survey and National Strategy (2015)

How much do I need to save for retirement?**

**Estimated figure using simple calculation, not taking into account: inflation, salary increments, etc.

Questions to ask yourself:

How much do I need for my monthly spending once I have already retired?

BND1,000 a month

When do I plan to retire?

60 years old.

How long do I expect my retirement fund to sustain myself? (i.e. what is my life expectancy?)

I am relatively healthy and expect to live to at least 80 years old. My retirement fund should therefore sustain me for 20 years after I retire (80-60=20 years)

Therefore, how much should my retirement fund be?

20 years x 12 months x B$1,000 = B$240,000

How old am I now? How many years do I have left to work?

I am now 25 years old. I will work another 35 years.

How much do I have to save monthly to achieve my retirement fund?

B$240,000 ÷ 35 years ÷ 12 months = B$517/month

How can I start saving?

Save first, not last!

Make sure you actively save! Meaning: put aside some of your income first, before spending it all.

Utilise technology!

Create multiple savings accounts, each for different financial goals. Then, set up an instruction so that a percentage of your salary is automatically transferred to the respective savings accounts on a monthly basis.

Shop and compare

Do this with saving products that are offered by different banks or insurance companies/takaful operators, to make sure you find one that is most suited to your financial goal.

Make saving fun

Develop a savings habit for your children from an early age! e.g., label coin jars with goals; or create a Savings Challenge.