Good Habits to Grow Your Savings

Good habits to grow your savings…

• Write Down Your Income And Expenses: List all your income and expenses. Write down the expenses as mandatory and voluntary. After listing all the heads, make two columns against each expense. One the expected expense, the other for the actual money spent. This way, you can compare the amounts and keep track of your hard-earned money and accordingly cut down wherever necessary.
• Be Ready For Emergencies: In order to be ready for the emergencies, here are two steps, which everyone needs to follow-

      One: Prepare an emergency fund, keep aside funds equivalent to three months mandatory expenses in the form of cash and fixed deposit so you are prepared for any untoward incident.

      Two: You should have insurance in place. This means life insurance of earning member of the family and health insurance for all other members of the family.

• Manage Your Debts: Debt may help you in buying that dream house or the car you desire, but if you go overboard, it can land you in trouble. Whenever you plan to borrow, first calculate the ratio of total annual debt payments to the total annual take home pay. As the experts say, the ratio should not be more than 45 per cent of your total take home pay. If it is more, not only you will be in financial trouble, but your credit history in the market also will take a beating.
• Read Financial Statements Carefully:  Reading your bills, statements and all your financial mails as soon as you receive it, is a habit that will serve you well. Often, credit card statements bill the same item twice or banks charge you erroneously. If you do not read your statements in time, you won’t be able to do anything about it and then it’ll take a lot of time and hassles to sort things out.  Reading your financial statements helps you know what’s going on with your finances and brings discrepancies to your notice while you can still get them rectified.
• Systematically File Financial Statements: This way you will have track of all your financial dealings and can refer to them in case of any trouble or find them when you need them. Also update your financial records regularly rather than letting it pile up for the year end.
• Complete bank Work On time: Do not procrastinate your bank work. For example, if your check book is exhausted, make sure you have a new one before the last check is used. This way, if you have to make any immediate unexpected payment, then there’s no need to panic. Also, keep your bank profile updated at all times so that your statements reach you in time.
• Make Timely Payments: Never delay monetary transactions – be it credit card bills, any other bills or mortgage payments. Delay means penalties and mind you, they are a quite a bit.
• Save In A Disciplined Manner: Every one should have a piggy bank, not just children, but the adults as well. However small the amount, save everyday. With the money saved per month, you can start small savings. These savings will help you to create a larger amount. When you start saving larger amounts, start investing in different investment avenues.
• Be Penny-Wise: Even if you can afford every thing, there is no harm in being frugal. The extra ten bucks saved on something add up and before you know, you are saving huge amounts. When planning to buy an expensive product do look out for deals. Due to increased competition, everyone offers deal. So why not save if you can?
• Plan Your Retirement: The earlier you start – the faster you will reach your goal. The amount required to save for your dream corpus will be much less if you start saving at an early age.