Everyone wants to earn more and get rich as quickly as possible. However, to do that, it’s important to think one step ahead of saving money. Besides savings, it is equally important to focus on developing practices that can help one in ramping up the savings and thus ensure a secure financial future.
Here are a few hacks to achieve this goal:
Set a purpose
To begin with, according to Anil Pinapala, founder & CEO of Vivifi India Finance, one should set a purpose before starting saving.
“It could be the aspiration to buy a new gadget, home, or saving money for future contingencies. Once an individual is clear on the WHY part, it will be easier to be disciplined about the practice," Pinapala states.
Keep a check on spendings
Pinapala further suggests one to keep a check on unnecessary overheads.
"Spend where it’s needed rather than splurging money on the salary day when it can be saved for better purposes," he affirms.
Mayank Goyal, founder and CEO of moneyHOP also suggests individuals to make sure they don’t spend more than they earn.
"It is useful to develop a habit of budgeting from an early age. The first thing to consider is to look through what they have spent on in the last few months and become aware of top expenses. This exercise itself can be quite revealing and can point one in the direction of where they can save more. A healthy savings rate is around 30-35 percent. Savings should not be what is left in the bank account at the end of the month but rather something one can do as soon as they get the paycheck," Goyal elaborates.
Start investing early and unleash the power of compounding
Compounding means the interest earned on the initial amount gets reinvested and a chain starts where money is working for the investor.
As per Pranjal Kamra, founder and CEO of Finology, the earlier one starts the investment journey, the more wealth can be generated.
Do smart spending
No matter how hard people try, they cannot completely reduce spendings to zero. But one can spend smart by using online payment apps.
"The benefit of these apps is that they can get vouchers and cashbacks which in a way help in saving while spending," Kamra opines.
Stay invested in a balanced portfolio
As per Abhishek Soni, CEO and co-founder of Upwards, the only way to consistently and definitively grow savings is to stay invested in a balanced portfolio of high/medium/low-risk investment instruments over a long period of time.
"These could be a mix of stocks, mutual funds, fixed deposits and gold depending on one’s risk appetite. Historically, stocks and mutual funds have given higher returns than the other ones. Individuals must stay away from any short-term or hype-based investing as it will rarely lead to a sizable return. High chances are they might end up losing money,” he explains.
Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.
(Edited by : Jomy)