If you are crawling the web to find ways to save money in the UAE, then you are probably not alone. Inflation is on the rise and you might have already seen its impact on your daily life. The cost of everything has shot up. Unfortunately, it not only affects your expenditure but also shrinks the value of your assets.
In simple words, inflations means all goods and services cost more than your buying power and your money loses its true value. You might be losing your money without even realizing it. Inflation can be a significant challenge for anyone’s financial well-being, and it’s no different in UAE.
With soaring prices on goods and services, residents in UAE need to be proactive in managing their money to combat the impact of inflation. This article will outline practical suggestions and ways to save money in the UAE so that you can maintain your financial stability.
Beat Inflation: Tips to Save Money in UAE
Over the last few years, inflation has surged across the world. With the rising living costs, people are more than ever inclined to figure out how to save money in Dubai and of course in other Emirates too. If people learn to manage how they spend and save money, it can perhaps lessen the impact inflation has on the value of money.
It’s high time that individuals and businesses re-evaluate their expenditures and saving strategies to survive during this recent wave of soaring inflation in the UAE.
Let’s arm yourself with some practical solutions and money-saving tips to help combat inflation.
- Opt for Saving Accounts with high High-Interest Rates
It can be quite intimidating to not be able to secure loans easily for high-priced purchases during peak inflation times. But still, you can benefit from higher interest rates on saving accounts to combat the impact of inflation on your assets.
Interest rates offered by banks on saving accounts generally cannot compete with the inflation rate, but these accounts can help create a safety net where you can earn good returns on your investment. It is of course better than saving cash at home or putting it in an account with a low interest rate.
Here is a list of the best fixed-rate savings accounts in UAE that might help you get good returns on your savings. Some banks offer as high as 4.5% profits on your investments which is a lot more than what regular bank accounts offer. UAE’s central bank has amped up the interest rates in the country and many banks are now offering competitive fixed-rate deposits.
You can take a look into these accounts, compare the features and profit rates, and make an informed decision according to your preferences. This might be the easiest way to combat the soaring inflation and retain your buying power.
- Take Steps to Reduce your Monthly Expenditure
If you have not thought of re-evaluating your budget, it’s high time that you take a look at your income and expenditure. We are often spending more than we actually need. To beat inflation and save money in these trying times, it’s recommended to plan and spend wisely.
You might have signed up for multiple paid apps to watch shows, stream movies, listen to music, and play games. Or it might be possible that you are spending more on eating out and paying bills than you should have. Often we pay more for convenience and end up emptying our wallets sooner than expected.
Considering the present financial landscape, many people are revising their budgets and taking drastic steps to cut costs. You need to make some lifestyle changes to spend less and save more in the wake of rising inflation.
You can unsubscribe to paid apps and keep one instead of money to watch your favorite shows on the weekend. Eat more at home and say no to dining out except on weekends. Sign up for apps to get discounts on food take -and deliveries. Take public transport when and where possible to save on fuel costs.
Here is an interesting read to help you find bus rides in Dubai for as low as 5 AED
Cut down on energy consumption Switch off extra lights in your home and use air conditioning wisely. Invest in purchasing energy-efficient appliances, and turn off electronics when not in use. Set the thermostat at an optimal temperature to reduce the chiller bill.
If you have outstanding loans with high-interest rates, consider refinancing them to save money. Lowering your interest rates can reduce the overall cost of your loans, freeing up more money for savings or paying down debts faster.
Prioritize your needs over wants. Here is a comprehensive guide to help you save money in UAE and cut down on unnecessary costs. Also if you are thinking of moving to a cheaper neighborhood to save money on housing, here are our picks for the best places in Dubai to find cheap apartments.
- Shop Smart
When shopping for groceries and other essentials, act like a savvy shopper. Hunt for sales, discounts, and coupons to reduce your overall expenditure. Keep an eye on monthly offers at grocery stores and hypermarkets. Buying generic or in-house brand products can also be a cost-effective option to buy things without compromising on quality. Sign up for loyalty programs and get cashback credit cards to earn money on your expenditure.
You can take advantage of the many thrift stores operating in the UAE to save money when buying branded goods. Most of these stores sell preloved luxury items at attractive rates. Shop smart at websites like Namshi, 6th Street, Sivvi, and Brands for Less to buy merchandise at a lower rate than the market.
In case you are interested, here is a list of the best thrift stores in Dubai to save money when buying branded items.
Lastly, tracking your expenses diligently is crucial. Use budgeting apps and websites to monitor where your money goes. Keep an app on your smartphone to monitor your income and expenditure. It will also be easier for you to keep track of the budget and take measures as and when needed. Money-management apps will help you in identifying areas where you can further cut costs and stay atop of your financial goals.
Here is a list of our favorite budgeting apps that you might also like. Take a look and see which one works best for your needs.
- Invest your Money or consider buying Government Saving Bonds
Inflation erodes the buying power of your money over time. To counter this, consider investing your money in assets that historically outpace inflation such as stocks, real estate, and gold. Diversify your investments to spread risk and consult with a financial advisor to make informed decisions.
It’s always good to have some cash saved as an emergency fund. But if you have saved money that you are sure you won’t be needing for a long time, you may consider investing it somewhere to gain profit. Buying a savings bond can also be a good option. With saving bonds, you have lower risks of losing your money.
Savings bonds are similar to certificates of deposit. You kind of save your money for a year and at the end of the maturity period, you get a guaranteed profit that usually stays at a higher ground than the present inflation rate. Saving your money via bonds would help you in retaining the value of your money over time.
Some factors may help slow down the current inflation in the months that follow. These include supply chain changes at a global level to make room for more inventory. This will result in lower prices for goods and services.
However, whether inflation soars up or goes down in the coming months or years, it’s always a good idea to take steps to maximize your savings.
Getting a hold of how inflation impacts everyday life is crucial. It helps in evaluating the actual worth of the money you possess. If you take a look at how your utility and grocery bills have shot up recently, you will probably be able to tell that inflation has been at work.
While it’s important to keep money saved in the bank to be used as an emergency fund, you must also consider other possible options to optimize your savings. This will not only help in saving more money but also in protecting the value of your money in face of the rising inflation.
Inflation can be a formidable financial challenge for everyone, but with careful planning and disciplined execution, you can mitigate its impact on your finances and save money in the UAE. Creating a budget, prioritizing needs over wants, and adopting smart financial habits can help you save more and spend less. This will help in securing your financial future even during inflationary periods.
Remember, it’s the small changes in your spending habits that can yield significant long-term savings. So gear up and start re-evaluating your budget. Good luck and happy saving!