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| money matters |
Here are some money saving tips that have[ (EGSPSM9DWT9M)]worked for many,which would very well work for you too. These tips were noted down, from the experience of money management and from my friends, books and some financial advisers.
Don't spend more than what you earn.This is the fundamental principle of making wealth.Also saving as little as possible will reward you in long run.
To keep a luxurious lifestyle people tend to spend more than they earn and as well go for debt.Carrying a debt is like having swords always hanging over your head,without you even knowing.The most common form of debt is credit cards.Avoid them to the maximum possible.
Credit to the creation of wealth (home loan)is not that dangerous, if taken judiciously, knowing fully about your ability to pay the credit. Always take only 50% of the value of the asset.The monthly payment also in the range of 50 % of your take home money.Pay the loan as soon as possible.
1)Never postpone the decision.
Never postpone your decision about your financial matters, whether it is about savings, paying your debts,or preparing your monthly budget.If tomorrow will be your answer to this, than you will be missing your opportunity in saving early.The early you save the more the compounding system works for you.
2)Set aside a sum when you receive your pay check.
When the pay check comes,you choose to set aside a specified sum for savings.This is the first step in creating a secure future. The savings account you transfer should be,if possible a low fee account with high interest-rate paying account.This amount is for wealth creation.
3)Save some for your vacation.
If you set aside a minimum amount every week’s regularly for a year, you would be surprised by the amount of money you had saved by the end of a two year period. Whatever little you can set aside, just do it. First transfer it to your savings account. This saving is not to be in the form of cash, since there will always be ways to spend it.
4)Prepare a shopping list and stick to it.
Take a shopping list before you go for shopping. Shop only the items listed and nothing else.Sticking to the list will avoid impulsive and unnecessary buying.
5)Have your annualised expenses report.
Write down your monthly expenses that you do in a typical month and increase that by 12 times to give you the annual expenses.To this you have to add your vacation expenses,your travel mode expenses, that is if you own a car take into account the interest for the value and fuel expenses plus depreciation of the vehicle.
From this:
a)fix a percentage,on the amount, that you will reduce on annual basis.
b)list them in order of total expenditure and try to avoid unnecessary ones from the list.
c)List out which are all of secondary importance and reduce them.
d)See which items total up to a major expense, and try to reduce that.
6)Make note of every day’s expenses.
Sit down and write every day’s expenses.If you do that you will know where the money went and for what purpose. It is easy to remember your daily expenses.At the end of the month, just add them into categories, such as Groceries, Clothes, Food, Movie and other things. You would be surprised by the financial awareness it creates for you.
7)When you go out in a group, Spend for yourself only.
When going out in a group, try to spend for yourself only.If someone is paying for you, give back your money to them or spend for them another time.
8)Carry your lunch box.
Yes, it works.
9)Never use credit cards, instead use debit cards.
10)Have a eye for financial news or refer some books, if investing.
Not everyone can be a financial expert. We need to know only necessary things that are enough to make our life comfortable, and make better decisions on investments. And, if you keep your eyes and ears open, you will receive good financial advice. Don't believe in easy money. Get rich schemes are designed to swindle money. Hot tips in stock markets are only Short-circuit tips. MLM schemes are a clever way to make the agent as the customer. Don't chase hot investments,they have crossed their prime buying price. Buying hot is overpaying for the stock. Always have a BUY price and SELL price for a stock ,derived by your own judgment(
look Here). Defence against a single class of stock is to invest in a few other class of shares and not over diversifying,which may become unmanageable for ordinary investor.
These tips are effective only when you act on them. Start with a one or two. First start with budgeting.Without knowing where your money goes, it is difficult to save or cut-down your expenses.
Just do it.
RAGHU NATRAJAN
