The devil is in the detail… also of your savings!
Have you started eating more salads and taking the stairs rather than the elevator? With the first rays of sun most of us get “in action” to prepare for the upcoming summer season – the short sleeves, the short skirts, the beach… Some people don’t bother: to get (back) in shape and be on a diet takes effort and, most importantly, endurance.It’s the same with savings. You have to be in it for the long term. And like with getting in shape or losing weight, the devil is in the detail: every cent you spend unconsciously you will have to earn twice to be able to save it!
Earn more or spend less
As a rule of thumb you should put aside 10% of your income in savings. If you’re not comfortable with your level of savings or if you find it difficult to save up for special projects like holidays, and especially if you are currently having trouble making ends meet, you have two options to boost your savings: earn more or spend less. Given that most of us don’t really have an option to just “earn more”, let’s concentrate on our spending habits.
Avoid “spending traps” at home…
During the past few decades our society has become more conscious about certain unnecessary expenses such as letting the water run while your brush your teeth or leaving the light on in the hallway while you’re watching TV. Here are a couple more habits that you can easily avoid and will do your savings account good:
- this summer drink tap water and fresh juices, instead of bottled water and sodas; and use ice cubes or keep the tap water in the fridge instead of letting the tap run for a while
- turn off your electrical appliances – leaving them on stand-by, with the little red light still on, can cost you around 10% of your yearly electricity bill. And it’s not good for the planet.
- dusty light bulbs lose potency and consume up to 20% more electricity, so remember to dust your light bulbs when you do your spring cleaning
- cook in large quantities, freeze some of it and take your home made lunch to work; you can easily save tens of Euros per month and still enjoy a coffee with colleagues in a sunny terrace or an ice-cream and a stroll through the park
… And in the car
We all know “time is money” and this goes both ways: an increase in cruise speed from 100 km/h to 120 km/h raises fuel consumption by more than 40%. Other traps you can avoid:
- a fully loaded car consumes more fuel (c. 5% more for every 100kg) so don’t be lazy and unload the bikes, the roof box/rack, the camping gear, the golf clubs…
- no need to press the gas pedal when you start your car… at least not the one you drive to work
- traffic jams are a reality, also in Luxembourg: save yourself some Euros in fuel (and probably also blood pressure medicine) by remaining calm and driving at a steady pace instead of constantly breaking and accelerating vigorously!
Do you know of other daily “spending traps” we can all avoid?
Often you hear people say: “Anyway, until I have paid off my home loan it’s the bank who owns my house”. But is it true?
It is always the same question that every one of us is asking before signing a home loan with his bank. To gain a more objective overview, let’s analyse them one by one with their respective advantages and disadvantages.
The rate remains fixed for a pre-defined period and, at the end of the period, is subject to a revision. The pre-defined period can vary from one bank to another but is generally 3, 5 or 10 years.