Many of us have been planning to start saving and building a portfolio but find it very hard to save with so many expenses in hand. But it’s amazing how easy it can be to squeeze some extra cash out of your budget – if you know how.
As a famous philosopher once said, the longest journey begins with but a single step. So here’s how to get motivated, and start achieving that savings goal.
First, work out your budget. Take a look at your last few bank statements and enter all of your income (salary, benefits etc.) in one column, and all of your expenses (rent, bills, insurance premiums, childcare fees, travel costs, entertainment, food etc.) in another.live streaming film The Bye Bye Man online
It’s easier to do than you imagine – you can collect your bills and total them up and fill the details in an excel. By subtracting your expenses from your income you’ll see how much money you have left over each month to save.
Cut your expenses
Now you may be looking at a pretty paltry sum, in which case there are many ways to boost it. But be warned – you’ll have to really want to economise to make decent savings.
First, pare down your bills. Cancelling subscriptions to the gym (you never go), extra dinner and lunches in restaurants (which you have been thinking of cutting down) or any other luxuries can save thousands per month and could be more cheaply replaced with a daily run around the local park and nice home-made healthy meal with friends. Likewise, finding telephone and broadband deals can boost those coffers greatly.
Next you need to reduce those living expenses. Work out where your money goes (your statement and a spending diary can help).
Some smart ways to cut your expenses:
– Write a menu for the week and only buy what you need from the supermarket – do not get tempted by the extras that the supermarkets display to tempt the buyers. Strictly Stay away from them.
– Find the best deals on your mobile phone to cut down the extra costs.
– And of course, bringing lunch to work will save a fortune compared to spending Rs 200+ each day.
But while you need to cut back, don’t go crazy. The main reason budgets fail is because many of us get over-excited when compiling them and leave ourselves with ridiculously meagre sums to survive on. Allocate a reasonable budget for food and necessities and allow yourself a few small luxuries each month – you’ll be far more likely to be able to stick to this long term.
You should now have an idea of how much you need to live on each month – and how much you’ll have left over to save.
Now it’s time to find a home for those savings and watch them grow. As much as it is important to save, it is also important that the money you save is deposited where you earn the maximum yield with minimum tax. Else you will start losing the value of your savings. Our recommendations:
– Ultra short term plans of mutual funds are a great place to park your savings. They offer better rate of interest than a Bank Savings Account and are even more tax efficient.
– If you are saving for the long term, then you might considering putting the amount in a 5-year fixed deposit offered by banks which will also provide you the tax benefit under IT Section 80C.
How to save more
But could you save more?
Sell: Have you got a house full of books, CDs, DVDs, computer games, toys, or gym equipment you never use? Then sell it and make a few thousands and create extra room in your house. You can sell your un-required items at www.ebay.in, http://www.olx.in/ or http://www.quikr.com/. Its easy to register and start selling your items.
Car sharing or car pooling can almost halve your petrol bill (not to mention reduce wear and tear on your vehicle). Find three other like-minded souls and you could free up hundreds each month. You can also car-pool with your office colleagues to save up on costs.
Frequent Flyer Membership: Enrolling to the frequent flyer program of airline like Jetairways could save you thousands each year by earning miles which you can use to buy tickets. You can earn extra miles not only when you fly and by using their e-ticketing services and web check-in service but also when you stay in hotel, use mobile service, rent-a-car service or use any of their other partner’s service. In addition, frequent flyer members also get discounts round-the-year at many restaurants, stores and other services which the program has tie-ups with.
Online Shopping: If you shop online, you can check prices at www.ebay.in, http://shopping.rediff.com, www.futurebazaar.com, www.naaptol.com and find the best deal for your electronics, home appliances, kitchen items, apparels, home décor and many more. Online stores offer very good deals, which can help you cut down your costs drastically.
Discount Vouchers and Deals: Cut down on your entertainment and health and beauty care bills by checking out the discount vouchers and deals available through websites like www.snapdeal.com, www.taggle.com or www.sosasta.com or you get through various membership programs you are registered with.
But beware of indulging in purchases of items you don’t need. Online shopping can be addictive.
And of course, the time will come that you’ll need to spend some money. But could you borrow the required item from a friend/relative?
When you have to go out, try to find good deals available through discount vouchers or memberships (airline frequent flyer program, shopper stop membership, etc). Whenever you spend just make sure you have given a thought to where your money is going and is there a better way to spend this money.
If you’re careful, but realistic, you should be able to save a surprising amount of money.