Plan your savings: Secure your Future

To begin with, let’s get one thing straight saving is not investing. However, the best way to save money is surely Investing.

There are some basic rules to save which we all know but maybe not applying. I have listed the following in brief but each and every point has equal importance.

Tips for Saving, Investing, and Spending

• Spend less than you Earn — It is said one should save 50% of your income. Well, If you can’t do this, save more than you spend.
• Everyone must invest in SIPs as of today. Have an Investment plan. If you are ready to take a risk then do some research and invest in equity.
• Avoid loans as much as possible. You plan to buy a car or a superbike in 2 years then start saving accordingly from today. You won’t regret it later. If you save the heavy interests on EMI that will be your best saving and numbers will speak for themselves.
• Always try to keep your EMIs within manageable limits.
• Do budgeting and keep an eye on your monthly expenses. Rightly said, one that can’t be measured can’t be controlled.
• Most importantly, Pay off your outstanding credit card bill every month before the due date. Never carry a balance or pay any interest on the outstanding bill.
• Do invest in Term Insurance and a Health Insurance plan for yourself and your family. Bad health or accidents never happen with a warning.
• Have a separate fund for Emergency purposes for those unforeseen circumstances. If you start building your emergency fund by adding a little part of your earnings to it, you will be saved from the financial burden to quite an extent.
• Eventually, all the Savings are for our old days so that we have a happy retirement phase. But, it’s always advisable to Save and Plan for Retirement.
• Invest in Tax Savings Instruments so that you can save the maximum. In India, the Public Provident Fund ( PPF) is the most recommended instrument. The invested amount is tax-exempt and Returns are fixed & tax-free.

Find your process of Investing

Talking of investments and figuring out the best way to save money, I have tried to simplify the process by creating a PLAN category.

PLAN helps me to shortlist and analyze how well I can save and my investments can give me maximum returns.

P — Productive investments

L — Leverage income

A — Attainable goals

N — Need-based expenses

1.Productive investments

Your investments are productive when the money is in some kind of renovation and improvement of the assets or in any acquisition as it creates new products, goods, and services, which will benefit our community like governmental investments. It not only brings in personal growth and welfare but also there is a lot of scope of growth and wealth maximization.

2. Leverage income

Are the investments leveraging your income? Leverage is the strategy to increase return on investment. You can make a significant profit by leveraging and unleashing the power of the internet to generate a steady stream of passive income.

3. Attainable goals

The goals you set for your expected returns need to be specific and attainable. It’s one of the well-established criteria of the SMART goal which emphasizes that goals need to be Specific, Measurable, Achievable, Realistic, and Time-bound.

4. Need-based expenses

With things becoming affordable our lifestyle is undergoing a major breakthrough. However, if you can imbibe the minimalist life and buy things you need and not the one you are able to pay will only make your life simpler and clutter-free. So, before making any significant purchases try to figure out if they are need-based or just another lifestyle add-on.

Start Investing Young

Mantra for saving is you are never too early or too late. But definitely, here we can say it really makes a huge difference if you started young as we all know “the early bird catches the worm”.

The best time to start saving and investing at an early age because it helps to develop a habit and improve your spending habit to be more exact. You know how to cut expenses and you get a good head start. If you are in your 20s you can take your baby steps and you will see the beauty of compounding.

But even if you are in your 40’s don't panic. Start investing and contributing as much as possible to your investment plan and keep increasing your stakes. The 40s is a crucial time so diversify your funds as per your priorities. Earn more, spend less, and build your portfolio. Have disciplined spending habits, prioritize your financial goals and my personal tip would be to have few equity stocks in your portfolio.

Get inspired and encourage yourself to start your investment journey today!