Luxury lifestyles are so attractive that we simply cannot refuse the opportunity to achieve it. However for a luxurious life you need hard-earned money, and there are so many costs involved with regular life that it takes no time to take away all your cash. Nowadays, the effort that we put to earn money equals the effort that circumstances try to take it away.

Well, saving doesn’t need a rule book; all it takes is planning and drawing lines between true necessities and unneeded luxuries. Here is a list of things, an individual should be focusing their attention on to avoid needless expenses and cover their financial needs.

1. Don’t dine expensively:

Eating at a café or restaurant is a treat we all love and look forward to. While it is usually more expensive when compared to homecooked food, it has none of the effort involved. Restaurant food involves service charges and taxes, but the restaurant’s popularity and fame also factor in which can make the food quite needlessly expensive.

To balance this equation, a proper routine should be fixed e.g. setting a budget for dining out and avoiding “instagram famous” spots as these often overcharge. Other than that, sometimes we get cravings of certain dishes, which can be easily beaten by cooking the meal at home. In the era of YouTube, searching a recipe is not a big deal. Just a few searches, purchase the ingredients and you can cook the same dish multiple times without burning a hole in the pocket.

2. Health is wealth:

You may have a lot of time and money, but as the saying goes: you are often 2 bad situations away from losing both. Always keep in mind that health is the biggest asset that a person should take care of.

Buy some good health insurance to stay secure for times when you fall seriously ill, or may unexpectedly require urgent care. Not having adequate insurance can mean you are spending thousands on medical procedures, which will put a big dent in your wallet and your mental health as well.

3. Be responsible with credit:

Owning a credit card doesn’t give you a license to spend money in a reckless manner. If you indulge in reckless spending, you will end up in inescapable debt in no time. You should always know the basics of credit card spending before using it, such as:

Set a hard limit on how much you can spend monthly with the card.

Make sure your limit only consists of money that you can pay by the end of the month to repay the debt. Failing to do so can land you in trouble and eventually you will be paying a late fine on top of your debt.

Never withdraw ATM money using your credit card as the tax charged on the transaction is a huge amount.

4. Learn a few financial lessons:

It is the art to learn about the working of money. The lesson is way more than savings and involves earning, managing, and investing it.

For people who have just started the basics, one should know the difference between an asset and a liability, which will give a clear view of things where money should be invested. For instance, purchasing a car is a liability as the price decreases with time, also it consumes fuel. On the other hand, investing in real estate will be proved as an asset as the price never decreases and it will act as a reserve.

5. Start Investing in Real Estate:

Investing in real estate is considered to be one of the best ways to save money as well as multiply the amount. Some of the reasons for this are the benefits that real estate offers, including a hedge against inflation, equity building, tax breaks, and competitive risk-adjusted returns. But investing in real estate would require you to know the sector in and out. It certainly requires a lot of research and due diligence to ensure that the purchase is a wise investment.

You should consider the various costs associated with owning real estate such as taxes, insurance, and maintenance. Apart from this, you will also benefit from knowing about schemes like the 1031 exchange, which tends to offer tax deferring opportunities. For the uninitiated, it is a strategy that allows investors to defer capital gains taxes when exchanging one investment property for another of equal or higher value.

Furthermore, you would also have to form connections with people who can find you the most lucrative deals — a real estate bird dog in particular. A bird dog is an individual who combs through the market for profitable investment options like short sales, foreclosures, and distressed properties and shows them to the investor; this is also known as real estate bird dogging.

As an investor, you have to just pay the bird dog a handsome amount of fee, so as to appreciate their hard work and ensure that you can make use of their service in the future as well. Purchase the property that looks most appealing and profit-bearing to you. Renovate it and rent it out to generate monthly income.