I'm gonna be honest with you: if your non-negotiable expenses exceed your income, apparently, there's no way for you to save other than finding sources for additional cash flows.
That's the first thing you wanna do before continuing on that goal to save:
1. Determine your disposable income and be conscious on it.
Determine your take home pay on a monthly basis and check how much is left after non-negotiable expenses. Meaning, those that you cannot live without or you cannot forego. Here's an example for your reference:
After listing all your monthly needs, try to pause for three minutes and reflect. Do you know where this amount goes?
Try to squeeze your head. Where does this amount go? Coffee? Frapuccino? Milk tea? Gadgets? Apparels? Lazada? Watsons? Or during seat sales of Cebu Pacific or Air Asia?
If you got a positive disposal income, it is not true that your salary is low to start saving. It is not true that you have to wait for a salary increase. You can start saving half, or even two-thirds of your disposable income.
Saving does not require a huge salary. It requires discipline and consciousness of your monthly spending.
There are many CPAs, engineers, doctors, and lawyers who earn A LOT yet they still encounter financial struggles. There are Overseas Filipino Workers (OFWs) who earn thrice the usual Philippine rate, yet when they come back, nothing is left for retirement.
Interestingly, a Pizza Delivery Guy may know how to save better than these professionals. It's not a question of how much you earn. It's a question of how much you save.
Be conscious by listing where it goes. By the next month, you are more aware and hopefully will be able to avoid it.
2. Cut the root cause or stimuli in spending unnecessary things.
Grass on a lawn continues to grow despite regular trimming. Why? Because it was not completely taken off from the ground. Its roots are still there.
Similar to this, you might be able to avoid the temptation for a few days or weeks, but there may be chances that you will still continue buying unnecessary stuff if you will not completely remove the root cause.
You spend a lot in Cebu Pacific Seat Sale. The stimulus here may be the notifications that you receive in your mobile app, or their Facebook Post, or their e-mail newsletter. You do not simply wish to avoid temptation in buying plane tickets. As you read this, unlike their Facebook Page, opt out from their e-mail subscription and uninstall their mobile app. Do this to similar sites such as Lazada, and Shopee.
Let's say you spend a lot in Watsons for unnecessary skin care kits. Guess what's the stimulus? The act of you passing by that store! Unless otherwise needed, stop going to Watsons! As simple as that. Or if you need to buy shampoo or other necessities, try going to a simple Supermarket where your addictions cannot be found. You may wanna consider asking your sibling or anyone who will go to a similar place to buy your needs for you.
3. Leverage Auto-debit Feature.
Open a passbook savings account without ATM Card. Then go to the bank of your payroll account. Ask them to auto-debit a certain amount to your savings account on a monthly basis. By doing this, you just have set up a mandatory saving. Watch it grows every year.
If you want to take advantage of investments plus protection, you may wanna consider opening a variable unit-linked (VUL) products and enroll it to an Auto-debit. This yields to a return way higher than banks, plus you are covered in case of critical illness, hospitalization or death. Unlike saving in a bank, you do not need to withdraw your saving in case of these uncertainties. You will be able to grow your money, and at the same time, protect what you have.
Having an auto-debit feature, be it to your bank or to your VUL Program, allows you to have a mandatory saving. Instead of not knowing where your money goes, setting up an additional "bill" like this allows you to track a portion of your monthly saving.
4. Bring exact amount.
Determine how much do you really need in a day as you go to your office. As much as possible, bring an exact amount. Have a cushion of, say, 20%, for any uncertainty. Having visible cash is the reason why you can say YES to any coffee, milk tea, merienda and catch-up-with-friends sessions.
This is also applicable to your credit cards. Do not bring them. Cut them with scissors if you really cannot control your spending!
5. Lighten your role as a bread winner.
I know a lot of people who give significant portion of their income to their parents and to their siblings' education even if it means not having the capacity to buy what they want. I salute them.
However, this heroism may also be the reason why some cannot save. Instead of saving their excess money, it is used to other household responsibilities.
A person does not have the opportunity to prepare for his retirement fund because he is the breadwinner of his family. When he gets married and builds his own family, his responsibilities are now doubled. He finds himself like a patty between two buns. This is the sandwich generation.
And then a deja vu happens. 40 years from now, his kids will be obliged to give provide for him in the future and they will not be able to prepare for their own retirement. Sandwich generation is a vicious cycle. It passes from generation to generation. One has to make a step to stop this.
Assess if you can decrease your family support and make them understand that you want to save something for yourself.
I just want to emphasize that this should be your last resort to save. Cut first your luxuries before you cut your family support.
Conclusion
Your road to saving requires you of two things: consciousness and discipline. You have to be fully aware of it and do something even if it will hurt your current lifestyle. Developing a habit of saving while you are young is crucial. Your future you will thank you a lot for this.
Being poor upon birth is not your choice. You know what's your choice?
It's dying poor.
