How to save money as a fresh graduate? | #LetsTalkMoney | BigPay

Fresh graduates have it tough. While everyone tells us it’s important to save money as soon as you get your first paycheque, the reality of life is that it might always be much easier said than done!

This can be woefully true, especially for today's high cost of living and fresh graduate salaries that have not kept up with it!

Even for those who've been in the workforce for a year or two, it may seem a stretch to consider saving money, given that the average salary for Malaysians hovers around RM 3,224 monthly.

While it's true that salaries do increase after a few years, there's often not much space left in the monthly budgets of fresh graduates to save — or does it? Well, maybe if you think differently! After all, having RM100 in a savings account is better than not having anything. Although saving may seem impossible, small amounts can still be pretty helpful to give you a start in your lifelong journey of saving money.

Here's what you can do to get the ball rolling on saving money even as a fresh graduate!

First, clear your high-interest debts

What’s worse than not saving any money at the end of the month? Having a negative number to start with.

This is why one of the best ways to start saving more is to tackle your debt head-on. You want to get rid of high-interest debt (such as an outstanding credit card debt or a car loan) as soon as possible.

Why? Because car loans and credit card debt often charge exceptionally high-interest rates and include numerous additional fees as well as charges apart from the debt itself!

When your budget is tight, you don’t want to be sending your hard-earned money to a credit card or car company. That makes life much more stressful than it really needs to be.

The sooner you are out of debt, the sooner you can keep your own money. Once the debt is gone, you’ll have both the mental space and money to start saving.

Next, keep a tight and steady budget

You’re probably already doing this. Tracking your expenses is helpful to regulate your spending and identify which areas could be improved.

We know, the hassle of going through your monthly bank statements and keeping track of every ringgit you've spent doesn't sound like fun at all, even though it allows you to keep an eye on where your money is going.

That said, have you heard of the nifty 50/30/20 budgeting technique? It can go a long way to help figure out what you can afford, now and for the future.

Simply put, setting a budget means putting a limit on what you should spend on a monthly basis!

Always save for a windfall

Whenever you get a larger sum of cash, such as a gift (especially with duit Raya coming in soon!), prize money tax refund, and more, it'll do you well to resist going on a spending spree and save it instead!

You can maybe put half of it into your emergency fund, keep a bit for yourself, and put the rest towards your debt. Windfalls are a great way to kickstart your savings journey, you’ll be motivated to keep the number high!

Lastly, look into earning money on the side

We all want to increase our income, and it is obvious that the higher your income, the easier it is to save. Setting a vague goal like ‘make more money' might not motivate you to make money on the side, which is why having a very specific goal can be helpful.

This could be as simple as ‘make RM100 extra a month selling homemade cookies’. RM100 might not sound like much, but remember what we said before; it’s better than RM0!

You can also look into doing side jobs such as babysitting or elderly care, or doing odd jobs helping people in their homes. Something more long-term could be driving for a ride-sharing service or tutoring others online or in person.

Bit by bit, this money adds up and you start putting it away into your savings account!

Saving on a low wage is difficult and you may feel discouraged or feel that it’s pointless.

But the truth is that if you adopt a mindset of taking it ‘bit by bit’, seeing progress can be very motivating. If you make saving a priority and pay yourself first every time you get your income, you’ll soon see that number creep up. 💪

While you're at it, it's also important to master the skill of knowing how to budget right, avoid the pitfalls of bad debt or even mastering the core money skills that will set you for life!

If you're interested to learn more about all things financial wellbeing and how-tos, leave a comment below and we'll get right back to you!