We are what we repeatedly do! Saving is not an action, it is a habit!
Successful savers are the ones who are habituated to spend less and earn more. Their simple mantra is to spend less than what they earn. They believe in the concept of ‘A penny saved is a penny earned!” It is that simple!
If you too wish to become an effective saver, here we suggest a few active saving mantras, applicable to everyone. Check if you are maximizing your potential as a saver! Because, it is important to value what you earn!
1. First Things First:
Priority is the key secret to saving successfully! Successful savers are clear with what they want in life. They prioritise their goals and diligently save towards meeting them, like
- an emergency fund in hand
- debt clearance
- medical insurance
- retirement planning
- long-term goals
Here it is important to note that priority does not mean compromising on your morning cappuccino. It simply means, knowing what is important and what is not, at that point of time. Realize what you can do without. Paying off debts sooner helps free-up more cash, which can be diverted to savings.
2. Clear Savings Goals:
Start saving with an objective in mind. Something like contributing 10% to 15% of income for retirement plan is what most successful savers do. Not just retirement plan, they plan for many important goals in life like child education, marriage, medical expenses, and many more. Success lies in planning ahead. Successful savers calculate, beforehand, what they may need a few years down the lane and start planning well-in time.
Setting clear savings goals help reduce unnecessary expenditure and stress levels. Effective savers rarely use credit cards for purchases, as they do not spend the money they do not have.
3. Reviewing Expenses:
Keeping a constant check and review on their expenses, is what successful savers do differently. This is a powerful means by which they avoid overspending. Additionally, they are active at regular checking of the market changes. They keep an eye on changing loan interest rates, insurance policies and many other things. This helps them switch between loans offering lower rates, thereby saving more of the hard-earned money.
4. Avoid Lifestyle Inflation:
Effective savers never get tempted to spend more, particularly when they receive pay hikes. Savvy savers are good at avoiding lifestyle inflation during the period of income growth. Rather, they invest in themselves, meaning adding more to other contributions like retirement or diverting amount to savings account. Thus, they eventually increase their investments targeting financial goals. The end result is reaching the goals sooner than planned!
5. Creating Personalized Strategy:
Highly successful savers have a clear strategy of their own. They set clear, long-term financial goals. They are ever-ready to face events like family crisis, natural disasters, medical issues, etc. Thus, they can be quick on the road to recovery, when hit by any emergency. After all, life is so uncertain!
In conclusion, maintaining a frugal lifestyle, even as the income continues to grow, helps us easily reach our financial goals much sooner. Good saving habits allow us to retire as per the schedule.
Our clients at ArthaYantra excel at exploring new ways and ideas to reach goals faster. We help people to get better with their hard-earned money, day by day. After all, we know what it takes to work hard and earn! We love exposing our clients to right saving channels to secure their financial future!