facebookThe Ultimate Step-by-Step Guide To Maximise Your Savings



Seedly Maximise Savings Guide

The Ultimate Step-by-Step Guide To Maximise Your Savings

profileDion Lim

At some point in all of our lives, we’ve all dreamt of becoming rich.

From finding a 9-to-5 job that pays a good salary to side hustles over the weekend.

It seems like the only way to be rich is to either have a high income or multiple streams of income.


I beg to differ.

I believe that the key to building wealth is to maximise the amount of money that you can save.

And this is best explained with the Leaky Bucket Theory.

What is The Leaky Bucket Theory?

The ‘Leaky Bucket Theory’ is a model coined by Andrew Ehrenberg to explain a key concept of relationship marketing.

Most companies focus on getting a constant flow of new customers.

But if they do not find a way to prevent the customers from leaving, they’ll always have to find new customers to replace the loss.

This is not sustainable.

And is a very apt lesson which we can apply to our personal finances.

Applying the Leaky Bucket Theory to Personal Finance

The constant flow of water into a bucket can be likened to our monthly income.

And the holes in the bucket are our expenses.

At the end of the day, how much water that is left in the bucket represents how much money we manage to save.

While most people think that a huge amount of savings is only possible if you have a huge income.

This is not necessarily true.

If you earn a lot but spend a lot, then you won’t save as much.

Conversely, if you don’t earn as much but you are strict with your expenditure, you might even save more than the high-earner.

The biggest takeaway here?

It’s not about how much you earn.

But how much you can hold on to at the end of the day.

The Ultimate Step-By-Step Guide to Maximising Your Savings

So… how do you maximise your savings?

It’s really simple.

You either increase your income (difficult to do).

Or minimise your expenditure (easier and within your control).

After crowdsourcing knowledge from the SeedlyCommunity here’s a step-by-step guide to maximise your savings. 

1. Set a Savings Goal

First of all, we would need to set a savings goal. 

It is always good to start with the end in mind and work backwards.

Here are some of the more common financial goals that most Singaporeans may have:

Personally, my goal is to save $100k by the age of 30

That being said, it is barely a third of the expenses required in a typical Singaporean’s financial journey on the road to 30 years old.


You’re going to need at least $397,056 to live comfortably in Singapore.

So better start maximising your savings…

2. Maximising Your Income

There are many ways to do this.

Earn Extra Income Through Side Hustles

You could do food delivery or give tuition…

Or try turning your hobbies into a side hustle.

This way you can still enjoy have fun while earning a little something on the side!

Improve and Build New Skills

Stay relevant and updated by using your SkillsFuture credits to continue learning, even after you leave school.

Or you can also take advantage of free online courses that are widely available.

This way, you constantly make yourself eligible for higher positions (read: more money) and can get promoted faster!

And ultimately can ask for the pay raise you deserve!

3. Minimising Your Expenses

First, you’ll need to track what you’re spending your money on.

And the best way to do it is via an expense tracker like the Seedly Expense Tracker App!

Identify Your Needs and Wants

While gym memberships and Netflix subscriptions are nice to have.

They are ‘Wants’ which you can live without.

Try exercising at home or seeking alternative forms of entertainment.

Get More Bang for Your Buck

Your ‘Needs’ would be like a mobile plan, so you can stay in touch with your loved ones, make e-payments, and etc.

Instead of locking yourself into an expensive 2-year contract.

There are many SIM-Only Plans out there there are cheaper and sometimes even provide more data!

You can do the same for your utility bills by switching to a cheaper Open Electricity Market (OEM) Electricity retailer instead.

Every little bit counts towards minimising your expenses as much as possible.

4. Growing Your Savings

To really maximise and grow your savings you can consider doing the following.

Use a High-Interest Savings Account

Before switching to a high-interest rate savings account.

I was using my POSB Kids Savings account which only gave me a mere 0.05% p.a. interest rate.

But I did a little comparison with the Seedly Savings Account Calculator and decided to switch to a better savings account instead.

Now I’m earning way more interest and will be using that to build my ‘untouchable’ savings.

Pro-tip: you can even automate a certain amount to be credited from your income every month, to be transferred into a separate savings account

Invest for the Long Term

While it’s good that you have savings in the bank.

You can’t beat inflation by leaving it there.

So instead of just collecting interest, you can also start investing your money.

This way you use the magic of compound interest and dividends to grow your savings.

(Thanks to the beautiful rule of 72.)

5. Tracking Your Progress

It is important to review your progress regularly so that you can keep your goals in sight.

Personally, I would do it every 3 to 6 months.

By keeping close watch of your progress, you can act and adjust accordingly if you feel that you can save more.

Or if you can find better ways to grow your savings.

Thoughts on Maximising Your Savings

It’s really simple to do so.

But it takes a lot of discipline to follow through.

If you need a more concrete framework as a guide, you can start off with the 50-30-20 Money Allocation Rule.

Once you get used to this, you can adjust the allocation according to your preference and start saving more.

Subsequently, you can even split your savings into short term and long term goals!

Are There Any Hacks to Maximise My Savings Even Further?

Still think that saving is too hard?

Want easier strategies to save up?

Well… you’re in luck!

There’s going to be a SeedlyTV episode about Easy Strategies For Beginners To Save Up, on 27 May 2020 (Wednesday) at 8pm!

Excited to learn more?

You can even start asking your questions now!

About Dion Lim
Busy undergrad by day, an aspiring entrepreneur by night. Fuelled by floorball and doodling, I chomp on bite-size pieces of finance to prep for an adventure that won’t make me yawn.
You can contribute your thoughts like Dion Lim here.

🔥 What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles

Stay updated with the latest finance tips!

Receive bite-sized finance on Telegram here.
💬 Comments (0)
What are your thoughts?

No comments yet.
Be the first to share your thoughts!

🔥 What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles

Join our Community!

Discuss your thoughts with like-minded members in these community groups!

Stay updated with the latest finance tips!

Receive bite-sized finance on Telegram here.