- An Early Start is a Good Start
- A Few Basic Saving Rules Go a Long Way
- Put your Savings to Work through Planned Investments
Big Billion Offers and Great Indian Discounts – we are a generation that always wants the best deal to achieve maximum savings, whether it is e-shopping, bill payments or travel bookings. We go out of our way scouring different apps and coupon codes and only make the purchase when it feels right. Now imagine, if you could invest as much time and energy in saving money, offer or not! Here’s the secret: Life is like a big savings offer, that’s always on, provided you know how to and have the right attitude.
Now, as people in our 20s, we know the exhilaration of our first salary (for those who are yet to start their first jobs, trust us!). For the first time, we have money in our hands (even if it’s not much) and the choice to do with it as we please. But with that comes the temptation of buying cool stuff, spending it on lifestyle, or for many of us – the sheer responsibilities and expectations of circumstances. Saving a portion of it quickly becomes a low priority – that habit of living pay cheque to pay cheque gets formed even if your income increases – and wealth-creation remains a dream.
But good habits, if formed early become a way of life. Financial Experts always stress the need for default savings, even if it means compromising on a few comforts. No matter the excuses or genuine constraints – it is awesome to forming the Savings Habit in your 20s.
10 Savings Techniques that can save you more money than any coupon code in the world
This one is the simplest, yet the most effective – Keep aside 20% of your monthly income as savings without fail, and try to invest it wisely either in a solid and safe investment instrument like savings account, a mutual funds SIP, etc. That’s the 80:20 Rule. Well, rules are meant to be broken – feel free to save more than 20% if possible!
We Generation Z’ers can sometimes be impulsive and easily distracted. But the list of desires and aspirations is long! Turn Wishes into solid Long Term Goals like – Bike, Higher Education, Home, Marriage, etc. Write them down and put them up if that helps! Calculate backwards – ‘How much will I have to save every month to enable a Wish?’ That will give you your Monthly Savings Goal! Put it up on your phone wallpaper, so that you don’t forget it next time you press that ‘Add To Cart’ button.
Create a Daily Budget
Always being aware of your expenses (where you are spending and how much) give you insights that surprise you! It also makes you conscious and aware while spending more (remember your Savings Goal?) It is necessary to note down your daily expenses and at the end of the month analyze all the expenses. If you find that you have made any unnecessary expenses in that month avoid the same next month. Before long, you yourself will create spending cut-offs and your wallet will thank you. And guess what you’ll achieve if you follow this pattern every month – SAVINGS! Well, that, and also Financial Discipline.
What you do with your savings is even more important than saving itself. It is better to invest your savings into RDs, FDs, SIPs, and many other instruments rather than just locking it away. Some people have the habit of keeping their money lying in low return current accounts or even withdrawing it to keep it in physical form. Well, lazy money does not grow. Make it work hard and multiply your savings!
Addictions are bad, we all know that. If your addicted to smoking, drugs, alcohol, etc then saving is the least of your problems. But it’s important to put a number – Just an example, 20 cigarettes a day at 20 rupees each comes to 12,000 a month. So, save your lungs and save your money. QUIT!
Other seemingly benign addictions can also put a dent in your savings – caffeine, junk food, video-games, compulsive e-shopping, binge-subscribing to OTT platforms, etc. Watch-out! Moderation will keep both you and your bank account happy.
Postpone Your FOMO
Saw something cool on Insta and must have it? Postpone it unless your Savings Target is met. WowPhone Ultra Pro Max XL launched at 1 lac only? Hands-off! If you save well now, you might not even have to think twice before buying the next WowPhone. Stick to your savings plan. Temptations aside, a little sacrifice and simplicity did not hurt anyone. Dream big, save even more. Spend within means (after accounting for savings). The Fear of Missing Out (FOMO) should be for a bright future.
Avoid Taking Debt
Just because you are getting a Credit Card, should you take it in your early 20s? The answer is an emphatic no – unless you absolutely have to. Nothing derails your Savings and ruins your Credit History like a Debt Trap – a situation when you’re lagging on your loan repayments, incurring huge interest and are forced to borrow to pay off earlier loans. Worse is you won’t get a loan when you need it most. Totally not worth it! Buying on EMI might be tempting and look harmless, but we suggest you hold off till you can actually afford it. When the time is right, using professional advice, you may consider taking finance responsibly to slowly build up your credit history.
Plan for Your Retirement
Old age – it happens to everyone, whether you like it or not and earlier than you think. Imagine having to slog at an age where people chill on a nice comfy armchair or do leisure travelling. You might think you’re too young to start thinking retirement. In fact, there is no better age to start! There are many retirement and pension plans that you can opt for at a nominal premium. The premium you pay for any such plan will be actually act as your savings. Plus, you can always retire early and pursue your dreams!
Generate a Second Source of Income
Don’t put all your eggs in the same basket. Cliched, but true in multiple ways! You must create some other income stream as you enter your 20s. It can boost your savings and act as a great back up in case of financial adversity, job-loss, etc. You can give a bike on rent, try working overtime, do a part-time job or get creative. Also, the returns earned by investing wisely practically act as a second income. In time, the earnings can get substantial and can even supplant your primary source.
Forced Savings for Future Financial Freedom
Deep down we all know we need to save. But let’s be honest, how many of us are actually able to do it effectively and regularly. But there’s a way that can make even the most spend-happy among us save – forced savings! Now, ‘forced’ doesn’t sound too pleasant to hear, but trust us – it works like nothing else. It actually secures your finances and sets your future free. Some good options are RD or a SIP. You can give standing instructions to the bank to deduct a portion of your income from your account on a particular date and transfer it to the R.D. account. The bank will automatically debit that portion of your money and credit it to your Recurring Deposit account leading to monthly savings in any situation.
There are also several Mutual Fund SIPs which you can choose according to your risk appetite and goal. The amounts can be really low at the start, but they go a long way over time. This can be easily done over apps, once you do your KYC and give your mandate.
Well, if you are in your 20s and have had the patience to read this far, consider it a great start towards your Savings Journey. Over time the Savings lifestyle stops becoming a chore and starts becoming fun – like a game where you keep getting better and better! Way more gratifying than any one-time discount code, if you ask us. All you have to do is copy the Coupon Code ‘SAVINGS’ and apply it to your life! 😉
Disclaimer: In case your’re not in your 20s, chances are this applies to you too. Or we’re sure you know somebody in their 20s who could use this. So, share away!