Want to Save More? Here Are 5 Tips to Manage Your Money Better
Getting your first job and making money can be an exciting quest – but it’s imperative to know what to do with your first paycheque, and well, each one that follows thereon. Don’t get us wrong, you absolutely deserve to indulge in your whims and treat yourself – albeit the right way. It doesn’t matter what you make, every penny matters, and if managed well, your money can be your safety net on a rainy day or the reason you can afford your dream car someday. Here are some tips for all you new (and not so new) employees to superintend your adult piggy banks in an efficient, fruitful way so that you can make the most of your hard-earned bucks!
Set Budgets. Stick to Them.
It’s very important to strike a balance between how much money you’re bringing in versus how much you’re setting aside to spend right away. Making a budget means taking control of your finances before they take control of you. Pre-plan your monthly expenses, segregate them on the basis of “essential” and “non-essential”, journal the daily ones, and try to stick to your predefined budgets. This habit will help you keep track of your money as well as foresee any big expenses and plan your finances accordingly.
Invest. Invest. Invest.
One of the biggest mistakes millennials make is thinking of investments as an option. No matter how small or big, set some money aside every month with the help of an investment plan of your choice – stocks, funds, bonds, FDs, gold, etc – which will yield far more returns than simply letting your money marinate in a savings account. Remember, if you save today, you won’t have to worry about tomorrow.
Classify Your Expenses
An easy trick to stick to your budget is allocating your money from the get-go, sometimes even before you receive your paycheque. Classifying your expenses can help you understand that you can set a little aside for fun and funds both without compromising on either. For example, at the beginning of each month, set 20% aside to splurge, 30% aside to invest and 50% aside to pay your bills. This way, you can strategise according to your needs while adhering to your budget.
Link Investments to Goals
It can be tough to invest your money when you cannot foresee what you may need to eventually use it for. However, as soon as you link your investments to goals or aspirations, you will be motivated to put as many pennies in the piggy as possible. Make a list of all the things you’d love to afford someday, and immediately start setting money aside to finance those goals. In no time, you’ll be able to start ticking items off your bucket list!
Don’t Underestimate Insurance
Insurance and investments aren’t interchangeable. Insurance is one of the most important types of investment that shouldn’t be neglected. Investments are cleverly curated so that you don’t have to suck your account dry someday in the wake of life’s uncertainties and can still afford to pay for them. It is imperative to get insurance for all your expensive belongings – your home, cars, goods, and most importantly, your health so that when life takes you by surprise, you know your money will always have your back.