Have you ever wished for a personal assistant who will take care of your personal finances? Most millennials spend a lot of their time earning money but do not have a strong savings portfolio as they do not pay heed to their personal finance. Though there are many apps and websites that offer money-saving tricks for free, a person has to stay organized and financially disciplined to start saving. If you are someone looking for some personal finance lessons, read on.
Tips to manage your personal finance and start saving →
Use A Personal Finance App: There are many free apps available online that you can use to help you stay financially disciplined. One of the leading personal finance apps is offered by BankBazaar. The BankBazaar App is an ultimate personal manager app that gives you investment and money savings tips. You can also do a quick bank balance check for multiple bank accounts and track your expenses with ease. You even get to manage your credit card expenses and get regular payment reminders for credit cards and loan EMIs too.
Set Goals: Remember as kids you collected every penny to buy your favorite chocolate? Having a goal will motivate you to save and will give you a sense of accomplishment when you achieve it, motivating you to save more. You can start by setting up small goals like trimming your food and entertainment bills or buying a new car. You can either set-up long-term goals like buying a new house or starting your own business or set-up a short-term goal like getting out of debt or clearing your credit card bill.
Do Not Deviate From Your Budget: Once you have set the goals and created a budget, stick to it. Without a budget, you might end up spending on things that are not important. If your short-term goal is to come out of debt, do not stop following your budget once you accomplished your goal. It is very easy to fall into the debt trap if you deviate from your budget.
Aim To Be Debt-free: When you want to start saving, the first thing to do is to focus on getting out of debt. Paying a huge part of your income towards debt will not let you build a strong savings portfolio. When you draft your monthly or annual budget, consider foreclosing loans and clearing your credit card bills. Once you come out of debt, plan your finances better and avoid taking loans just because they are freely available.
Consider Opening A Small Recurring Deposit: When you make healthy financial changes, you will take some time to get used to the changes. Opening a small recurring deposit account will help you stay motivated as you know you now have some savings in your kitty. It does not have to be a huge amount every month. Start by opening a recurring deposit as low as Rs.500 every month. This will act as a reality check whenever you feel like overspending.
Stop Paying Only The Minimum Due Amount On Your Credit Card: This is one of the most important financial lessons one can learn. Avoid paying only the minimum due amount on your credit card. If possible, clear the total outstanding balance or little more than the minimum due amount. When you pay only the minimum due amount on your card and carry forward the remaining amount to the next billing cycle, your credit card provider will charge interest on the revolving credit on a daily basis. This way, you will end up paying a lot towards interest. The habit of paying only the minimum amount due will also affect your credit score negatively.
Small financial changes that will help you in the long run →
- Avoid eating outside and consider cooking. Eating outside is expensive especially if you do it frequently.
- Avoid carrying cash and your credit card when you step out. Leave your credit card at home and carry the cash you need to avoid overspending.
- Do not take personal loans to buy the things you want. Consider saving and buying it without the pressure of EMIs.
- File your taxes on time. It could look like a small thing but you will end up saving more in the longer run.
- Compare your insurance policies and switch to a better plan that gives your adequate coverage. This includes your car, motor, health, and life insurance policies.
Ask for professional advice if you unable to manage your finances. Educate yourself about various ways you can start saving and stay financially focused. It might seem difficult to stay within a budget but soon it will become a lifestyle helping you save more.