Drops of water make an ocean.
Similarly every penny saved is a penny earned adding to your savings. There is
no need to explain why we need to have good savings. Just read these tips below that will help you
save money that you knowingly or unknowingly ignored.
Don’t ever buy a
Credit Card.
The Numero Uno thing that should
always be on your Never-to buy List should be Credit Card. One of the biggest
mistakes that individuals do is to own a Credit Card. Having a Credit Card is
like having a Debt Machine with you.
There is absolutely no need for a credit card in your life. Buying a credit card absolutely beats the
reason why want to buy it. Let me explain this situation. Say you and you
long-time friends decide to have a reunion sometime during month end. Since it
is month end you don’t have much money left with you. So while at the
restaurant, movie and (the worst) for petrol you decide to use your credit
card. Assuming that this bill turns up to nearly a 2000 or 5000 bucks depending
on how spend thrift you are. Generally Credit Card Companies usually have a 20-30
day window for pay back. Suppose you used your card on 28th of a
month. Then the due date for the bill will be anything near 15 or 20 in the
following month. It is usually during this period that you need to pay all
other utility (Electricity, TV, and Household) bills too. So you have
additional debt of credit card and now for the worse you have to spend half of
the month with even less money than you had in the previous month. Now this is
where you get into the trap of these companies. So in case you have to purchase
something essential you again decide to use your Debt machine. Thus you are
entrapped in the credit card cycle of debt.
The worst part of credit card is
that you have to pay for it even if you don’t use it. Yes! You heard it
correct. You pay for not using a credit card. Even though that Sweet lady on
the phone who sold you this debt machine promised that there are no monthly
charges for it I bet she didn’t told you that if you don’t spend a stipulated
amount in a year you are liable for a fixed charge.
Plan you bills
Now this is a part that no one in
this planet is saved from. Paying your bills is as important as breathing for
your life. However it is important that you plan on how you are going to pay
your bills. There is numerous numbers of bills that an average family has to
take care of. Excluding the Essentials like grocery, electricity, apartment
maintenance we have other bills that are to be taken care of like Insurance,
Tax. A common tendency that is noticed for paying bills is that we pay our
bills before the due date. It is absolutely not necessary for paying the bill
the very next day. With most of the companies accept e payments you can pay
your bills on the last day while you enjoy your banks interest for the same
number of days that it is with them.
Certain bills are fixed in nature like water and cable, so you can set
aside a fixed amount aside every month. For bills that are payable once a
quarter or year like tax and insurance make sure that you have planned it. You
don’t want to sit wondering how you are going to pay it. For bills that are payable in quarterly or
yearly open FD, make short term investments and repay such yearly or quarterly
bills.
Don’t be a spend thrift, Stop acting rich!!
Agreed that your neighbour bought
a new car. They even change their furniture every year, have new clothes every
month. This doesn’t mean that as a social stigma you try competing with them.
Stop acting like you are already rich. Don’t be a spend thrift. Before buying
anything think whether it is really essential or buying it just because it has
been marketed to look like it’s the best thing to buy. Stop impulsive buying.
Yes!! You need to put an end to your impulsive buying. What started as way to
relax yourself may soon turn into a nightmare if you don’t learn to control
yourself. You may be buying unnecessarily just to satisfy yourself. You may
want to project yourself as a flamboyant, rich and careless person; all of this
with no saving is just going to end you up with a really bad ending. This
attitude is just foolish and highway towards bankruptcy. While an occasional
outing with family is necessary is essential for adding the spice in life, but
make sure it doesn’t cost a bomb and you end up blowing away all saving which
was to be used for some other purpose other than this outing.
Start Early
The proverb “Slow and steady wins
the race” doesn’t apply to your finances. In-fact the more early you start the
more secure you are. Start saving from Day 1 of your job / business. Tomorrow
is day nobody will see today. You never know what tomorrow is going to be so
better be prepared for it. You benefit a lot from starting at an early age.
Your premiums are low; you may invest less and earn more. Moreover you can pass
this habit to your other family members. You can inculcate this good habit to
your children from a very young age if you practise it yourself.
If you start very late this is
bad not only for you but for your family as well. You may have no emergency
fund to support any medical emergency in the family. Looking at the high cost
of education today (School, Tuition, Hobby,) forget higher education even basic
education may seem to be a difficult task. All of this can be avoided only if
you start early. Even small amount have a large impact on your long term
savings.
Have a plan and a backup plan.
There is a saying among all the
Financial Planners “If you don’t plan you plan to fail.” Planning is very
important not only in your financial life but also for your personal plan. If you decide to do save money you to plan
how you are going to do it. Whether you are going to have short term or long
term plans. Also have a backup plan in
case your plan are crashing or seem to be failing at some point of time this
your you can prepare for the worst and reap the best.
