Importance of Savings
Building wealth and having a stable financial future both depend on saving money. You can escape life's uncertainties and have the ability to live a quality life by saving money. Your ability to overcome challenges and hurdles in life may be aided by methodical money saving.
Regardless of income or spending, everyone needs to save.
There are numerous easy and numerous ways to save money. Some of the reasons why you should start saving are listed below.
Reason why you need to start saving early:
- It gives you a better future.
- It provides for your children's education.
- It helps you in your unplanned medical conditions.
- Moreover, it gives you a peace of mind (a stress-free life)
Tips to save money:
- Limit your credit card usage.
- Keep a track of your expenses.
- Invest in long-term funds.
- Create a budget for savings.
- Start small (money box or piggy bank)
- Pack your lunch.
- Eliminate your debt.
- Decide your priorities.
- Make savings automatic.
- Pick the right savings tool.
“It is never too early to encourage long-term savings.” — Ron Lewis
A short story on how I started my savings
My first salary as a fresher was 12k per month, with which 4k was my room rent, 2k for my food expenses (groceries), and 2k I used to spend on my travel to visit my hometown. With the balance of 4k, I have started to save 3500 regularly. Opened an RD account and started investing in that. Once the RD matured, I got a wholesome amount of around 1L. Later with this matured amount I started an FD and invested the whole amount there. Parallelly started another RD and my usual routine of saving continues. This time I got an increment and my salary & savings hit 15k & 5k respectively. Whenever my salary increases, I will cautiously increase my savings as well.
This lumpsum amount helped me a lot with my marriage. Most of the girls dreams would be around her marriage on how it should be done. What costumes to wear. Our costumes should match the stage decorations. Enquiring on photography that should include cool candid pics as well. The marriage hall, food, invitation card and so on.. My marriage was not very grand and luxury, yet it was simple and elegant. I had fulfilled all my wishes without anyone's help. I could able to achieve this only since I knew that savings is important.
I always have a formula on savings
Income - Savings = Expenses
As soon as you get your salary, set aside a portion for your savings before you use the remaining money to pay for your expenses.
With little ones in mind, this is the time to encourage open talks about wants and needs. Plant these thoughts now and watch them flourish over time.
The 50/30/20 Rule of Budgeting:
The 50/30/20 rule of budgeting is a simple method that helps you manage your money more effectively. This basic thumb rule is to divide your post-tax income into three spending categories – 50% for needs, 30% for wants, and 20% for savings. This is not a hard and fast rule but a simple guideline that helps you build a financially strong budget.
The Bottom Line
It's crucial to budget your money. It eases your mind, increases your choices for actions that have a significant impact on your quality of life, and eventually allows you the choice to retire. Most people who are wealthy got there through a combination of their own hard work and smart savings and investment decisions. You can become one of those people, too.
The fun fact is "No Money" means "No Honey"
I'm not saying Money will get you happiness, but Money is a reward for solving many problems.
Savings and Investments are two powerful tools in your hands that help you build a financially secure and independent future. Use it wisely and enjoy the journey of Saving and Investing.
"Do not Save what is left after Spending, but Spend what is left after Saving" -- Warren Buffett
"Happiness is not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort." --Franklin D. Roosevelt
"Money is a terrible master but an excellent servant." --P.T. Barnum
"Try to save something while your salary is small; it’s impossible to save after you begin to earn more." --Jack Benny
"Wealth is the ability to fully experience life." --Henry David Thoreau
Please vote, if you like my blog :)
© 2023 Shibi Prince