When Should You Start Saving Money and How

how to save money

“The future will be here before I know it and chances are there will be challenges along the way,” said nearly every human who has had at least some experience living on the Earth.

While this is mostly the case with all of us, the thing is that with every new year, we assume that this one is going to better than the rest. We plan for an exciting future. And most often than not we think about things going extremely well the day after tomorrow.

At the same time though, an inner voice reminds us from time to time that things might as well go off track at some point in life. That’s where we start thinking about that rainy day and about our resources with which we have to overcome it. Here comes the idea of saving. And it’s not something defined by how much money you have, how much you earn, or how old you are. It’s more about long-term financial goals.

Saving is a decision that you make and then a lifestyle that you adopt. But before diving deep into when and how to save money, let’s first find out what “saving” means.

Saving vs Savings

Saving is the money not spent. And there is something you should know about “savings” too. In financial parlance, “saving” and “savings” denote completely different things:

  • Saving is the method of putting income aside
  • Savings is an increase in assets or net worth

This means that a person can create savings without even having to actually save money. They can create savings through increased wages, purchased assets or even through winning a lottery. But still, the most common method of increasing one’s savings is by saving money.

how to save money


So, when to start saving?

According to Richard Reis, if you save 5% of your income, you’ll retire in 66 years. If you save 75%, you’ll retire in 7 years. But are you saving for retirement? Is that your final destination? A lot of people save for their emergency fund, others do this to buy a car or a house, some other people save to pay off a debt. So, when to start saving basically depends on your goals. But the good news is that you can save starting from this point because the earlier you start, the more money you will end up having at the end of the day. That’s as easy as pie, isn’t it?

How to save money?

There are a bunch of ways you can start saving money. Plus, there are several mobile apps, cashback services, productivity tools that can help. Let’s start with the easiest formula which is saving 20%-50% of your income.

First, you start saving 20% and as you go, you develop more skills and it gets easier for you to put up to 50% of your income aside. How to do this? Well, by cutting off all your expenses starting from grocery shopping and ending with monthly gym subscriptions.

N1: Cutting off on eating out

Ruzielle Ganuelas tells how she and her partner moved from eating out to eating in. It’s a common scenario for a couple living together to eat out most of the time. But this certainly won’t help save money fast. Ruzielle tells how she started cooking at home and managed to save half of their monthly restaurant budget ($400).

how to save money


N2: Cutting off on other stuff

What about other stuff? One tip that can work for anything else except grocery is buying used (lol). Why not? Unless you are the King of Spain, you could consider buying used stuff online. For example, you want to purchase a book on Amazon. Do you know that there is a little “used” category under nearly every product on Amazon? By clicking on it, you can buy books for $1. Free delivery! Isn’t that cool?

N3: Living smart. Using mobile apps

You could, of course, cut off all of your monthly expenses. But if it doesn’t sound like you, maybe it’s time to look up the App Store for a smart fintech solution.

Looma is a mobile app which helps automate your spending and saving habits. Every time you spend money on something, Looma automatically shaves off a percentage and moves it to your savings account. If you are a real fintech guru and you don’t want money to just sit in your savings account, you can tell Looma to move it somewhere else, for example to your crypto wallet (to buy some cryptocurrencies for you) or to your brokerage account (to buy stock for you).


At the end of the day, deciding when and how to save money is all about making choices. If you are really into saving, it doesn’t really matter how much income you receive or how much money you owe in debt. Start saving today!