Saving Money vs Making Money

I am currently on the look-out for a job and starting to feel the importance of having savings, especially for rainy days like this. No job equates to no income, but the fixed monthly expenses like mobile phone bills, insurance, transportation and food expenses will still be there.

As I see my savings account taking a hit, I start to be thankful that at least I am able to get some pocket money from trading forex. It is very important that we do not rely on solely one income because we never know what will happen. For instance one can be retrenched, met with an accident or become so ill that he/she is unable to commute to work.

There is no doubt that everyone wants to be rich and wealthy but which is more important or likely to lead us to becoming rich? Is it save more money or should we look to making more money? In actual fact, I think it is both.

WEALTH = WHAT YOU EARN - WHAT YOU SPEND

It is easy to see that to be wealthy, we need to take note of how much we are earning and how much we are spending. Earn more and spend less will lead to a wealthy life.

How to Earn More?
The usual source of income for many of us would be salary. To get more from salary is a bit tricky and if we are like the average employees out there, it will more or less be capped at a certain amount. To have a high salary, we need to stand out from our peers, be value-added to the company or if you are lucky, just make sure your boss likes you enough to give you a pay raise and promotion.

Other than salary, I feel we need to know how to source for additional income. One can take on part-time or free-lance job. Otherwise, you can learn to make your money work for you by investing them in stocks that generate dividend income. Alternatively, you can be like me, trade forex for additional income.

How to Spend Less?
This is a tricky question because spending habits differ for every individual. For me, I start to shop online lesser as I know the tendency of me buying things on sale or on impulse is high. I feel you need to look at your spending habits and pattern and then identify if you are spending too much on unnecessary things or which area are you spending too much on. It would be good to install expense tracking apps on your mobile phone to help you control your expenses. If you realised that you have been spending too much on drinks and entertainment, you may want to cut down on your socialising activities for instance. Watching too many movies a month? Then you may want to consider giving yourself a quota on number of movies you can watch per month.

I know this is demoralising and you may feel that you are missing out on a lot fun. Unless you are earning a hell lot more than you spend, otherwise, stay frugal will be a good stepping stone to getting rich.