In a previous post about financial independence, I talked about the meaning behind financial independence and how to get started. In this post, we will look at 6 simple ways to improve your savings in Switzerland. If you are not a frugal person nor someone who watches spending, then these baby steps will guide you in the right direction. By spending less, we will be saving more! And saving more means more options for your future.
According to a recent OECD report, Switzerland has one of the highest savings rates in the world! It was estimated to be 23.14% in 2020. This means if a Swiss earns CHF10,000 per month, an average of CHF2314 is saved!
The only other country that has a higher savings rate is China at 36.14% (but the latest figure dates back to 2016). France has a savings rate of 15.73%, the EU averages at 12.32% and the US only manages 7.8%.
However, when you speak to someone from the FIRE (“Financial Independence, Retire Early”) movement, their savings rate can be as high as 50% or more! This is absolutely doable if you drastically decrease your spending or increase incoming without increasing your lifestyle or both.
While it is not easy for an international civil servant to get a promotion, you can easily decrease spending. That is within your power. The effects can be seen immediately by an increase in your bank account. It is just a matter of how much you want it!
I have listed below 6 very simple tips that could help you spend less and save more.
Tip 1 – Before making an online purchase, bookmark your item and wait
Everyone loves online shopping! Online shopping is convenient and gives us a big dopamine rush. The majority of purchases are made on the spur of the moment rather than out of necessity. Furthermore, according to studies money spent on material purchases, does not boost positive emotions the way we might expect.
So, instead of checking out your shopping card immediately, save it as a bookmark in your web browser and include the price of the item.
Regardless of the discount, summon all your willpower and do not succumb to the urgency to purchase it immediately. Leave it for 24 hours while you think about the following questions:
- Is this item going to save you time and/or money in the long run?
- Are you going to use it often?
- Is this item unique (i.e. you don’t own something similar)?
If you answer all nos, then you don’t really need it.
Repeat this process and compile all the items that you didn’t buy on an impulse. Personally, I find that I either forget about it or my need for it diminishes. I have a bookmark folder filled with non-purchased items. You should be proud of the money you’ve saved.
Tip 2 – Automate your savings
We are inherently very lazy animals. Automating your savings is a sure-fire way to save money each month.
First, you need to know how much are your very basic expenses. How much is your rental, transportation, food, utilities, etc?
With this amount, you’ll have a good idea of how much of your salary can be saved. Assume you earn CHF10,000 per month and need CHF6,000 to cover all of your expenses plus a little extra for discretionary expenses. This leaves CHF4,000 that could be saved. Set up a monthly standing order in your current account to transfer CHF4,000 to your savings account as soon as your salary arrives. By automating this process, you would “force” yourself to save CHF4,000 per month!
“Do not save what is left after spending, but spend what is left after saving.” — Warren Buffett
Tip 3 – Online grocery saves time and money
Ever since the pandemic, I’ve been buying groceries online from the local supermarket chains Coop, Migros, and popular online shops like Farmy and Magic Tomato.
Online grocery shopping is definitely a time saver. No need to get dressed. No driving to the supermarket. No need for parking. No running up and down the aisles. No queuing at the cashier. Finally, no stress!
I was initially sceptical of online grocery shopping. I was concerned that I would receive expired or stale produce. However, after two years, I am very pleased with all of the deliveries. It is true that some fruits and vegetables arrived damaged on occasion, but I was promptly reimbursed.
In addition to saving time, online grocery shopping definitely saves money. You can filter all of the promotional items with a single click and use your coupons and collect points as if you were shopping in a store. The only thing you’ll have to pay extra for is delivery.
Coop offers free delivery on orders over CHF99.- if you are a “Hello Family” member and have a special code.
Migros’s delivery becomes reasonable if you make a bulk purchase of at least CHF160.-.
Farmy offers free shipping on orders of CHF50.- or more, and they have an excellent selection of fish and meat products.
Magic Tomato offers free same-day delivery as long as you order a minimum of CHF60 before noon and they offer fresh quality products from local producers in the region.
Tip 4 – Stop receiving “publicité” in your mailbox
Put a “pas de publicité” sticker on your mailbox to stop receiving advertisements. You’ll be less tempted with impulsive buying and your mailbox will not be overflowing with junk mail especially while on vacation (which is a security hazard). Moreover, you will be helping the environment with less paper waste.
Do the same with your email by unsubscribing or blocking marketing emails that are not of interest to you. Your inbox will also be less cluttered.
Tip 5 – Track your expenses, especially subscription services
Examine all of your expenses to see what can be cut, especially recurring subscription services, which may seem insignificant each month but can add up over time. Here are some examples:
- Do you need 200 GB of Google Drive when 100 GB will suffice?
- Do you need to subscribe to Amazon TV, Netflix, Disney channel etc?
- Do you require unlimited internet on your mobile phone, or can you do with a less expensive and smaller plan especially if you have daily access to wifi?
- Do you need a full CASCO car insurance for your 10-year-old car or a partial would do?
- Do you have time to read all of the paid newspapers and magazines to which you have subscribed?
Tip 6 – Eat out only when there is a discount
If you enjoy eating or dining out, thefork.ch offers regular deals and promotions that can save you up to 50% on food. It is also a good chance to discover new restaurants at a reduced price.
It is completely free to sign up. To receive CHF10 (1000 yum points), sign up with the code 7AA41866. Thefork.ch’s best feature is that you can reserve and cancel directly from the app, and you can pay with credit cards at the restaurant.
I would also recommend Passport Gourmande, but reservations must be made by phone 24 hours in advance, and credit cards are not accepted in the restaurant.
Finally, Buyclub.ch offers good restaurant deals, but you must wait for the voucher to be ready and usually must reserve by phone in advance.
Just remember that the most important thing is to be mindful of your spending and where the money goes each month. Each small step you take now results in reaching your goal closer. Make it simple by automating your savings as soon as your salary arrives. Building your wealth is simply living under your means and investing as much as possible by buying and holding investments for an extended period of time.
Small changes to your lifestyle could improve your long-term savings. So what other money-saving tips do you have? Share it with us in the comment below and don’t forget to subscribe!