All these years, all I thought was how to save??? How much is sufficient to survive in future??? How will I get extra income??? so on and so forth...
But I never had an answer...
Some suggested me to invest in Shares, some in fixed deposits, some wanted me to go for Chits and some to invest in real estate... All I did was, got more confused and did nothing... Below are the starting steps towards savings.
Savings Account:
My suggestion to all who wants to start on saving is... Open a savings bank account in any of the nationalized banks and start transferring money from your salary account to the Savings account on a regular basis.
How to do this?
Step 1: Open a spread sheet and write down all your expenses
Step 2: Mark the ones that cannot be avoided. Highlight the ones that can be avoided and still your lifestyle doesn't get affected by avoiding them.
Step 3: Subtract your Expenses from your salary.
Step 4: Transfer the remaining amount (If you are lucky to be left with some money) to the Savings bank account
Step 5: Now go back to the spread sheet and try to cut down on the avoidable expenses which are highlighted in Step 2.
Step 6: Follow Step 4.
Every month right after your salary is credited, you transfer the amount (Step 4 and Step 6) to the savings back and then try to pay other bills. By doing this, not only you will be disciplined in your spending habits but also you will pay yourself first and others later.
Bonus:
Whey you receive bonus between your appraisal cycle, try to have it in a FD. This will not only give you extra income you need but also you will get tax exemption. Ask Google for details ;-)
Stocks:
Please be extra cautions before investing. As always people say, stock market is not for everyone. But I say, Stock Market is for the prepared lot and not for the luck wanderers. Try to gather information about the market, companies, inflation, economy etc and try to find a good script and invest in it. Invest in regular intervals and try to check the status regularly.
Compulsive Spending:
Many a times, we buy stuff not because we are in need of it, but just because it has a discount on it or you feel that you too had to have it...
The key to succeed in not spending on unwanted stuff is to WAIT... Yes. if you wait and could control the impulse for a little time, you would probably not buy it or get if for less. So next time you get tempted to buy something you really might not need, take a step back and wait for a while before going ahead and buying it.
(Refer: Success with Procrastination)
PPF:
Open a public provident fund account in any nationalized bank or the nearby post office (I prefer banks and the online transfer is easy with them). This will not only save tax but also give huge interest in returns. Only glitch is that the principle and the interest would be locked for a period of 15 years. But its a good saving scheme.
Gold:
Buy gold. Easy and simple right. Yes investing in Gold ETF or buying gold for that matter is considered a good investment. Study the market for ups and downs which are for sure the common game with ETFs, buy when you think the market is hitting low and try to invest for a long term.
These days we are getting EMI facilities in the local market to invest in Gold. These are not only helpful in saving small amounts, but once you save a considerable amount, you can buy gold with them. But again choose wisely where to invest.
Mutual Funds:
MF's are also considered a good option for investment. There are n number of schemes available. choose the one that suits your age, pocket and risk taking capability. Invest in regular intervals. Many of the MF's returned a good % in long term. The key is not to panic and wait for the right time.
These would be sufficient for freshers to start with. The above options will make you disciplined in saving and well educated in finance.
But I never had an answer...
Some suggested me to invest in Shares, some in fixed deposits, some wanted me to go for Chits and some to invest in real estate... All I did was, got more confused and did nothing... Below are the starting steps towards savings.
Savings Account:
My suggestion to all who wants to start on saving is... Open a savings bank account in any of the nationalized banks and start transferring money from your salary account to the Savings account on a regular basis.
How to do this?
Step 1: Open a spread sheet and write down all your expenses
Step 2: Mark the ones that cannot be avoided. Highlight the ones that can be avoided and still your lifestyle doesn't get affected by avoiding them.
Step 3: Subtract your Expenses from your salary.
Step 4: Transfer the remaining amount (If you are lucky to be left with some money) to the Savings bank account
Step 5: Now go back to the spread sheet and try to cut down on the avoidable expenses which are highlighted in Step 2.
Step 6: Follow Step 4.
Every month right after your salary is credited, you transfer the amount (Step 4 and Step 6) to the savings back and then try to pay other bills. By doing this, not only you will be disciplined in your spending habits but also you will pay yourself first and others later.
Bonus:
Whey you receive bonus between your appraisal cycle, try to have it in a FD. This will not only give you extra income you need but also you will get tax exemption. Ask Google for details ;-)Stocks:
Please be extra cautions before investing. As always people say, stock market is not for everyone. But I say, Stock Market is for the prepared lot and not for the luck wanderers. Try to gather information about the market, companies, inflation, economy etc and try to find a good script and invest in it. Invest in regular intervals and try to check the status regularly.
Compulsive Spending:
Many a times, we buy stuff not because we are in need of it, but just because it has a discount on it or you feel that you too had to have it...
The key to succeed in not spending on unwanted stuff is to WAIT... Yes. if you wait and could control the impulse for a little time, you would probably not buy it or get if for less. So next time you get tempted to buy something you really might not need, take a step back and wait for a while before going ahead and buying it.
(Refer: Success with Procrastination)
PPF:
Open a public provident fund account in any nationalized bank or the nearby post office (I prefer banks and the online transfer is easy with them). This will not only save tax but also give huge interest in returns. Only glitch is that the principle and the interest would be locked for a period of 15 years. But its a good saving scheme.Gold:
Buy gold. Easy and simple right. Yes investing in Gold ETF or buying gold for that matter is considered a good investment. Study the market for ups and downs which are for sure the common game with ETFs, buy when you think the market is hitting low and try to invest for a long term.
These days we are getting EMI facilities in the local market to invest in Gold. These are not only helpful in saving small amounts, but once you save a considerable amount, you can buy gold with them. But again choose wisely where to invest.
Mutual Funds:
MF's are also considered a good option for investment. There are n number of schemes available. choose the one that suits your age, pocket and risk taking capability. Invest in regular intervals. Many of the MF's returned a good % in long term. The key is not to panic and wait for the right time.
These would be sufficient for freshers to start with. The above options will make you disciplined in saving and well educated in finance.
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