When it comes to money and happiness all we need to do is ensure that money is not the everyday problem it can sometimes be for those with lower income levels. This better money habits guide will show you how to treat money the right way: so that it lasts and works for you. We can't help you make more money, but if you learn how to be a better saver, your money can go a lot further than it does.

Sometimes the hardest thing about saving money is just getting started. This step-by-step guide for how to save money can help you develop a simple and realistic strategy, so you can save for all your short- and long-term savings goals.

Create a budget

Having a budget is one of the simplest and most crucial ways to start financial planning. With a budget, you are less inclined to spend more money than you need to.

A budget is a plan that you set yourself for your money where you make your cash work for you and your needs. Having a budget is going to help you establish spending limits and set you on your way to responsible money habits.

If you have not ever set yourself a budget before, not worry. There are many different budgeting apps you could try as well as many helpful blogs that are going to help you figure out how to budget, and how to actually stay on track with this new financial direction you are taking.

Start saving

Saving money for your future should definitely be at the top of your financial priorities. Sometimes though, it can be easier said than done, especially when you are not making a lot of money and are drowning in debt.

In times like these, it is still good to save, even if you are just saving 50 rupees a month. When you get into the habit of saving, it becomes easier for you to put money away later on in life too, no matter what your salary is.

If you find that saving even 50 rupees is a challenge for you, it might be a good idea to find some work-from-home jobs you can do to create an extra form of income. Online jobs are becoming increasingly more popular because there are a lot to choose from, depending on what your interests are and how much free time you have.

Set specific financial goals

Having financial goals is great because it keeps you motivated to work towards something you actually want to achieve. Financial goals are very subjective and not one size fits all. One person’s financial goal might be to become a millionaire by 50, and another person’s goal might be to get out of debt by 30. It all depends on you and your specific circumstances.

Once you know what your goals are related to your finances, you can start coming up with a plan. If you are someone who has a lot of debt and wants to pay it off before you turn 30, look at how much you owe. Then, calculate how much you would have to pay every month until you reach 30 to pay it all off.

Sometimes, you may find that you can’t reach those goals in the exact time frame you set out for yourself. And that’s okay. In that case, set smaller goals that will ultimately get you to your bigger goals and to where you want to be with your finances.

Pay off your credit cards

A big thing that many of us struggle with financially is credit card debt. If you’ve racked some of that up, there are ways to go about credit card debt which will make your life a lot easier.

A good rule when paying off credit cards is to look at your debt in chunks rather than looking at the whole number. For example, say your debt is 10,000 PKR, you can divide that up into 2,500 PKR payments. Sure, the balance you owe is still the same, but this way makes it a little bit more manageable to pay off because it’s a less overwhelming approach.

Also, if you carry a balance on more than one card, it is good practice to pay off the one which has the highest interest rate first. This way you will be saving yourself from higher interest fees.

If you can afford to, pay a little more than the minimum balance. When you do this, it is going to help you pay off that debt much faster. That, of course, leads to less interest you have to pay.

Don’t impulse shop

Impulse shopping on a regular basis isn’t the best money habit you can have. Not only does it potentially lose you a lot of money, but it also makes you buy a lot of stuff that you probably don’t even need.

I’m not saying that going shopping once in a while is going to completely mess up your finances. However, there is a smart way to shop that is going to be more effective than impulse shopping.

A simple way to shop with a purpose is to have a shopping goal. Before you go out, make a list of the things you need to buy, and stick to that list.

If you feel like you really want something that isn’t on your list, tell yourself that if you still want it the next day, you will come back for it. Chances are, you will not really feel like going back to get it. That will tell you that you didn’t really want that item in the first place.

Start an Emergency Fund

Make saving for an emergency fund a priority, and put as much in it as you can. 300 is a good start and eventually, move up to 1000. If things ever go wrong, you will be glad you planned for a rainy day.

Have a Retirement Plan

You may think that your twenties are too young to start planning for retirement. I disagree! You never know what might happen in the future. The sooner you start investing in your golden years, the easier you will have it later on.

Pay your bills on time

A very good money habit to have is to learn how to pay your bills on time. I don’t know about you, but I hate remembering an over-due bill at the end of the month when I don’t have much money left over.

Getting things paid for on time is going to save you a lot of grief down the road.

Positive money mindset

Finally, last but not least, I think a great money habit to form early in life is to have a positive money mindset. A lot of us have been told all our lives that rich people are greedy, or that money is not important, or that we will never be rich.

These limiting beliefs are only going to hurt your mindset towards money, possibly to the point where you won’t care about making it and saving it. This mindset is incredibly toxic because your thoughts eventually become your actions.

Wanting to be financially stable is not something to be ashamed of. Nor is it something that is impossible.