How to save 90% of your income
As I briefly mentioned in a few places on my blog, here and here, I currently set aside 90% of my take-home pay. And if I can do it you too can save 90% of your income/take-home pay!
First off, let’s establish the terminology. When I say “take-home pay” I actually mean Salary – CPF – Mother’s allowance. Yes, I know my mother is theoretically a part of my home but it is easier to do all my calculations this way. Perhaps I should find a new terminology. Oh well, that is a problem for another day. For now “take-home pay” it is!
I bulk prepare food for both my girlfriend and myself. I will spend half a day on a weekend preparing at least a week worth of food. To keep costs low, I am cutting back on meat and meal prepping with more vegetables and staples instead. This is something we started very recently so we are still trying things out. So far it is working out pretty well. I even created an excel spreadsheet that has a breakdown of how much it cost per meal. So far I am keeping the cost of each meal at the 1 to 2 SGD / meal range.
Try to “make” things if you can. I have been making my own yoghurt out of whole UHT milk and it has been working out well since I use yoghurt in many of my recipes. The idea of bulk purchasing UHT milk just to make yoghurt is really tempting at this point. And this leads to my 2nd point.
Buy in bulk / on discount
It is almost always cheaper to buy in bulk. Always look for package deals especially if it is something that does not expire quickly and/or used a lot. Smaller stores, including small online retailers, tend to allow bulk rates of some sort. Just ask. The worst case is purchasing the item at the listed price.
I also shop at the discounted section. Especially for items that are near expiry. If I am going to cook soon and I can get the item at 50% off, I’ll get the one at 50% off. It is exceptionally convenient nowadays with websites like RedMart providing a discount section.
Well, how about eating out? This is something both my girlfriend and I (mainly her) struggled a little with. An eating out session is expected to happen sooner or later when you are out dating. And specifically so when you do not live together. What we eventually settled on are rare, more affordable meals only if we have to. We will try to eat before heading out and only eat when we are back at home. If all else fails, we will find an affordable place to have a simple bite.
There are also occasions when there is peer pressure for a social gathering. For cases like that, politely decline, or if you are interested in going I would suggest an affordable place and then order something filling-and-will-not-break-bank on the menu. I am also inclined to invite people over to my place where I can cook a meal for them, again without breaking the bank.
I try to walk as much as possible. I will only take buses for short distances if I can make full use of the transport rebate system. More on this in a bit. Also, since walking is beneficial for overall health it is generally a wise idea to walk more.
Make full use of the rebate system
Essentially, the Singapore public transport system fare is calculated based on the total distance, so the boarding charge for each individual service is theroatically free.
There are however some rules that govern the transfer system.
- Transfer time limit of 45 minutes.
- All journeys must be within 2 hours of the first boarding on the same journey.
- Single entry and exit allowed for rail.
- Current bus service must not be the same number as the preceding bus service.
- Maximum of 5 transfers can be made within a journey.
More info on the rebate system can be found here.
I currently spend about 50 – 75 SGD / month on transportation.
Plan ahead, avoid taxis / grab / uber
I now avoid all sorts of higher cost transportation like a plague. I was “hooked” on them and convinced myself they are cheap and affordable. Yes, they are convenient no doubt, but never mistake them for cheap. They are nothing but. Even if GrabHitch or UberPOOL is seemingly cheap, they do add up. If you really need to get somewhere quick, go ahead. But never let it be a habit. I’ve been there and the aftermath is not very pretty. Thus, always plan ahead when going out. Take note of last bus/train timings.
I do have some exceptions to this rule of mine though. Grab/Uber is acceptable when:
- I am in Johor Bahru
- It is midnight, I miscalculated and there is no longer any public transport home
Yes, I am living with my mother and I love every minute of it. Mother is home. Mother is love.
All my family’s bills are under my mother’s name and hence she settles them too. I just give her a fixed amount every month. My personal phone bill is around 30 SGD / month.
In my home, everything is shared. We can eat/use anything that we see which can actually save a lot of money. I never had to buy garlic because garlic is always stocked up. Haha!
Currently, I am paying approximately 230 SGD / month on insurance. More on the type of insurance I have here. I am happy with all my insurance plans and do not intend to add anything extra in the near future.
I try to limit the number of misc items I buy, but sometimes there are certain things that are way too cute to pass up on. I have to confess I purchased (my girlfriend paid for it though. =X) 2 fox plushies from Minoso 2 months ago.
There are also sudden unexpected expenses that need to be addressed. Things like medical bills and sudden death of the mobile phone. But I tend to keep these expenses as low as possible and try to find alternatives for them. Example:
- Medical bills -> Over the counter medicine
- Mobile phone -> Cheaper alternatives like XiaoMi
As can see from my breakdown, it is actually not hard, and certainly not impossible to save 90% of your income. Just be more diligent and plan more. Your future pocket will thank you.