5 Easy Ways of Making a Habit to Save Money

 

Most individuals have big financial dreams. Everybody is saving up for some goal, such as purchasing a car, putting a down payment on a home, or saving up enough to go on a trip overseas. However, they struggle with saving money. Without savings, people cannot invest. And without investment, they become unable to fulfil their goals. Let’s look at how you can make it a habit to save money regularly:

Set SMART Goals

People make the mistake of setting vague goals. Use the SMART policy for your finances. Start by creating a specific target. Instead of saying you will try to save every month, give yourself an amount. Next, ensure you can measure the goal. Instead of simply attempting to increase your savings each month, try and save an extra INR 1,000 each month. Your goals should also be attainable. Do not set yourself up to fail. Finally, your goals must be relevant and time-based. Ensure you give yourself a timeline to save a specific amount. SMART goals set you up to succeed by giving you specific targets.  

Spend Within Your Limits

Some make the mistake of using their credit cards or overdraft facilities impulsively to purchase items they do not necessarily need. Using such facilities without planning properly and evaluating the usage time to time can lead to a cycle of debt that becomes dangerous and makes it difficult to save. Always try and live within your means and avoid spending more than you earn.

Save First

Put your savings away in a separate account once your salary gets credited every month. Pay yourself first, and then pay your bills and other dues. Making saving a priority helps you cultivate a habit of saving every month. You can consider investing in a savings plan such as the HDFC Life Sanchay Plus to develop the habit of saving systematically. It offers guaranteed* benefit payouts along with life cover.

Use Automated Debits

Set up an auto debit feature if you put your savings in a separate account. Every month, the money will automatically get transferred, so you have to save before you do anything else.

Track Your Finances

Even after you put your savings away, always track your savings and try and save an excess amount every month. Check your statement at the end of every month and see if you can cut costs on certain unnecessary items.

A habit of saving helps you inculcate good financial habits. Once you save up a corpus, you can start investing and secure your financial future.

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ARN: ED/02/23/31970