Every family and every family member has their own financial goals. Some wish to retire with a handsome bank balance while others wish to own a dream house or take a foreign tour. Any financial goal involves some sacrifices and planning for the future. Saving is the requirement of any financial plan. For saving a sufficient amount of money, you need a disciplined financial practice for the family. Here is how you can fulfill any financial with the help of savings.
Create a plan for saving
No matter how much money you make, saving up the maximum amount possible is the first step towards your financial goals. If you wish to buy a house worth Rs. 30 lakh, you need to save a substantial amount of money every month. Saving only Rs. 5000 a month even if you have a good salary, will give you that amount in 50 years which will not be sufficient.
If you are 30 now, you must plan to buy the house before you turn 50. Keep in mind that the price of that house will also increase with time considering rising land prices and inflation. In such a case, you must save up at least Rs.15,000 every month starting today. Sounds tough? Don’t worry, a right plan will get you there. Here, are some small steps to help you further.
- The first rule of saving money is to cut back on unnecessary expenses.
- Make a list of expenses by your family which includes every rupee that you all spend in a month.
- Note down the things on which you can cut back your expenditure, such as utility bills or entertainment bills. Once you have identified that, your next target should be to control everyone’s personal spending habits.
- Impulsive shopping or visiting restaurants more than once or twice a week should not eat into your savings or be a part of your financial plan.
- Once you have your savings in place, you can start investing.
A portion of your savings should be utilised to make investments. It will allow you to grow your money. Invest in assets such as gold bars or coins. You can invest some of your money in mutual funds that offer security and diversification of funds. Avoid greed and invest only in instruments that offer maximum security.