QUESTION: How to budget if you want to save up for a goal quickly?

When you face the task of quickly saving up for a major financial goal, standard budgeting is no longer enough, and stricter measures are required. At the first stage, it is necessary to find two or three of the biggest saving levers in your current life that give the maximum effect. First of all, such large expense items as rent or mortgage costs, maintenance costs for personal transport or taxis, spending on restaurants and food delivery, as well as existing credit obligations, come under critical analysis. Optimizing at least one of these areas can free up significant funds.

The next step will be a radical change in the proportions of your income distribution in favor of savings. If you used to save the standard ten percent, then for the period of the financial marathon this figure should be increased to twenty or even thirty percent of your monthly income. At the same time, it is important to temporarily introduce strict restrictions on all non-essential expense categories, such as buying new clothes, entertainment, spontaneous purchases, and trips.

To successfully get through this period and not break down, it is recommended to limit the duration of such a marathon to a period of one to three months. Short-term nature helps to psychologically cope with restrictions, because you know the exact end date of the strict economy mode. In parallel with this, transfer all accumulated funds to a separate bank account without the possibility of quick withdrawal to protect them from the temptation to spend on momentary desires.