We often encounter the objection that, despite good intentions, many do not have money left to invest. But so far no one has convinced us that it really is. Whether you earn thousands of euros a month or a minimum wage, you can always find space to invest. Do not believe? Read on, maybe you’ll be surprised by yourself.
In principle, the area of personal finance is not complicated. To achieve your goals, whether small or large, just follow the 2 simple guidelines:
- Spend less than you earn
- Invest the difference
Point 1 can be resolved by reducing consumption or increasing revenue. This part is up to you. We’ll be happy to help you with point 2. But let’s go pretty well and try to find out where you could get the money to invest.
You can save the most on big expenses
First of all, pay attention to the biggest items in your budget – mortgage and other credit. Do you still have a mortgage with an interest rate in excess of 2%? Consider refinancing it, it can save you tens of euros a month. However, do not accumulate the saved money unnecessarily in the current account for the purpose of early repayment of the mortgage. It’s not worth it. You better invest them.
Don’t overlook consumer loans, credit cards, and other debts. If you are repaying loans at 10% or 20%, consider consolidating them. Merging credit can significantly reduce your regular monthly repayments as well as your overall overpayment.
If you live today for high debts from pay to pay, merging old debts into a new one at a lower rate, you will receive tens to hundreds of euros per month that you can use for example. to build a financial reserve. So that you never find yourself in this situation again.
Even small spending hides big money
But the big money is also hiding behind the seemingly small spending of daily consumption. Take the time to review your bank account movements, or write down every expense for a few months. Don’t skip small items with the reason “it’s just a few euros a month”.
If cholesterol is a quiet heart-killer, regular monthly spending is a killer of your wealth. The options to save money are uncomfortable: unused subscriptions to newspapers/magazines and services, bank account maintenance fees, expensive or unnecessary insurance policies, out-of-home catering, excessive spending on internet, television and mobile flat rate, a member in the gym, where you almost do not go, a car with high consumption, …
Perhaps you may need to speculate over 7 euros for keeping a bank account, 20 euros for television, or 30 euros for a flat fee. But the actual cost of this expenditure is much higher.
The difference between 10 and 30 euro lump sums is not only 20 euros. You can invest 20 euros each month. Only this one decision can bring you 37 thousand euros. You can earn so much if you regularly invest 20 euros in stock index funds for 30 years. This is the real cost of an expensive flat rate.
Do you pay 7 or 9 euros for your current account? It’s no longer a problem to have a free account today. Either you fulfill your bank’s terms of account discount or you can use internet bank services like Bank.
If you manage to reduce or eliminate a few minor expenses, you will probably find yourself suddenly free to save tens of euros a month. You won’t even mention these minor spending cuts by 20 or 30 years. But thanks to them, you can have tens to hundreds of thousands of euros in your account and your life may look completely different.
When it’s not where to cut, focus on revenue
If you don’t see room for saving and investing even after careful consideration of your expenses, then the other side of the equation needs to be addressed. Sometimes it may be easier to get a salary increase at work than to try to save a few euros on (really necessary) spending.
The evaluation interview and the salary negotiation certainly do not belong to the popular activities of most employees. Many have avoided them for a long time. But ignorantly, they are depriving themselves of really big money.
If you can save half of the “new money” you earn and invest on a regular basis by raising your salary of € 100 a month, you can have over 20,000 euros in your investment account for 20 years. Isn’t that heavy hour with the boss/boss worth it?