Money saved is money earned. Make this your mantra in 2015 and as far as your financial life is concerned, you cannot go wrong. It does not mean you cut down on the occasional weekend dinners or not give in to retail therapy once in a while, it just means being more careful with how you use your money. Also, saving habit need not be boring or passive and that requires intelligent and creative intervention. Here are 10 tips showing you how:
1. Review that home loan
Take time out to review the interest that is paid on your home loan. There is so much competition for this product in the market and you must take advantage of this. Make sure your bank is giving you the best deal. If not, compare and negotiate! Even a small adjustment adds up to a big amount over the years.
2. Too many cards kill the budget
Empty those credit cards from your wallet and pick just two which you really want to continue with. The deciding factors should be reward points and low interest rate. Since, most of the time one credit card carries only one of these benefits at a time, it is a good strategy to retain two cards. Having a limited number of cards also helps keep a tab on spending habits. Spending is done more consciously and acutiously while unnecessary expenses are automatically cut down.
3. Car loans
Negotiate for better rates using your Cibil credit score. Lenders often offer lower rates for borrowers with better Cibil scores. Also, make sure you don’t finance the car add-ons. For the accessories or add-ons check with local dealers for better rates. That way it turns out to be a cheaper option, rather than paying interest on it for the entire loan repayment period.
4. Get organized and play CID
Arrange for all bills, statements, etc to reach you before a pre-decided date every month. Then analyze and check for mystery charges. This habit will also help you recognize your spending patterns. These can then can be corrected or can be planned for in advance thus helping you save money.
5. Plan ATM trips
Impose a restriction on your ATM visits. This simple act helps in numerous ways. Expenses are planned in advance and cash needs to be withdrawn accordingly. There is no room left for temptation to withdraw cash whenever an ATM is in the vicinity. Many banks have started charging customers for ATM usage when the number of transactions cross a certain number. By planning withdrawals in advance one can easily avoid bearing such charges.
6. Saving while getting insured
No one understands your needs like you do. Do your homework and work out your own insurance amount. Also, before buying any new insurance check if you are already adequately covered under an existing insurance scheme. If not, go in only for the additional amount. It is also a smart thing to shop around a bit after you have worked out the requirements. Go for an insurance plan that suits you the best. And while at it, remember that insurance works best when it is not coupled as a savings plan.
7. Track your expenses
Have a personal tracker to keep a check on your daily expenses. Either maintain a small diary if you belong to the old school, or do what the geeks do and download a mobile application which will help you with this. Analyzing expenses on a regular basis can prove to be a very effective way to save on expenses which are not accounted for or are unnecessary.
8. Choose banks wisely
Take stock of all the bank accounts and lockers which you own. It’s time to de-clutter and get organized. Shut down accounts which have not been used for regular transactions for six months or more. Also, check lockers that you are currently using. It is not uncommon for customers to change lockers along with a change in address. However, the old lockers remain in your name. Closing old accounts and lockers can free up the deposit money which can be reinvested as per your own needs.
9. Save up during sale season
Retail therapy indulgence reaches new levels during the sale season. We are not saying you shun these sales. After spending reasonably on purchases, discounts on products leave you with some free money and you can make this work for you. Next time you avail a discount, deposit the discounted amount into your savings account and incorporate it in the investment plan.
10. Don’t leave your investments unattended
While one does feel a sense of relief after planning, choosing and implementing an investment scheme, it is important to note that these investments need to be reviewed regularly – every 6 months or so will add incisiveness to your decision-making. A decision made two years ago may not be fetching the same returns today. Analyze and decide your next investment move accordingly.
Saving is not a onetime plan but a way of life. This is one habit which will fetch positive returns right from the moment you start.