We Indians have always been good
savers with our gross savings rate at 31% of GDP in the year 2016. Savings rate
is the share of gross savings in Gross National Disposable Income (GNDI). But,
as per IMF(International Monetary Fund), its gross savings rate has actually fallen
from 37% in 2007-08 to 31% in 2016.
(SOURCE: DBS Group Research)
1.
LEARN
We normally tend
to avoid something we don’t understand. And with variety of financial products
available at our disposal, one obviously gets confused. Many a times we blindly
follow our friends and relatives for investments and then burn our hands. The
key is to learn, understand, and then take action.
2.
SET
GOALS
You just have a
fair idea that you need to save. Having no specific goal in your mind does no
good benefit, it rather distracts you from saving. Create realistic goals to
give purpose to your savings, be it buying a new car, saving for vacation, or
your retirement. To see your savings, grow and meet your set goals will be a
real motivation to save more.
3.
AUTOMATE
YOUR SAVINGS
We are living in
digital space these days with the world in our mobile phones. Then why not
bring this automation in our savings as well. You can set an auto-debit from
your bank account towards your savings fund for the required date. By doing
this, your money will get invested automatically on a pre-set date every month.
It will save you the hassle to getting to do the work yourself, and you won’t
even know that you have shifted to INCOME-SAVINGS = EXPENSES mode.
4.
STAY
IN CONTROL
As per research,
people who feel powerful around money are much better with their money
decisions. There is no need to fret if you have made some wrong financial
decisions. You can always sit back, think through, and take corrective action.
It will not only enable you to save your money but will also give you a lesson
with regards to your future savings.
5.
KNOW
YOUR FINANCIAL APPETITE
We all are
different individuals with different choices, and the same relates to our
savings as well. Some of us are risk-takers and some of us prefer
risk-aversion. Only if you are comfortable with your portfolio instruments,
will you invest more. In the long run, equities have performed much better than
any other asset class. Having little bit of equities in your portfolio will
only benefit you provided you stay invested for the long term. Seeing your
money grow will obviously nudge you to save more.
Saving money for your future is important. Once you are in
savings zone, you will be having money for all your important milestones like
kid’s education, your retirement, or any other goal that you need money for.
You just need to know what motivates you to keep saving.
Charu Hastir, CFPCM is founder of http://www.theriteplan.com/. Rite plan is an online financial planning
portal created to achieve a single objective of providing easy and Do It
Yourself Financial Planning to netizens. Rite Plan is wholly owned by Tikkun
Olam Financial Planning Services LLP. Please visit: https://theriteplan.com/index.php?route=common/home/
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