I have been working in the field of marketing for last 3 years. When I calculated the amount I have received from various sources I was amazed at the number. I have earned 10 to 11 Lakh Rupees of salary. I took the personal loan of 2 lakh from a bank. I earned as much as 50 thousand rupees from my investments. Inspire of all this, my savings are close to zero. I have not built any assets. Nor I have invested in any shares or bonds keeping the larger picture in mind.
To learn the art of managing finances, I shuffled through some books, some books came my way, I watched some videos. Finally I found a book I can relate to.
The secret of managing our finances lies in one simple thing- the willingness to do so. Many of us are not simply aware that we need to start saving. RIGHT NOW. Some of us have got good jobs, some of us are born with silver spoon in their mouth while some of us believe in living for the day. But, neglecting the much needed need of savings can be disastrous in long term.
Just think about this, how have you prepared for medical emergencies; have to taken care of the education of your children; how have you taken care of your retirement funds. If the answer to any of the above questions is negative you should start building your savings right away.
The technique I am going to discuss is the simple one. And is equally effective.
Buy three piggy banks. Lable them as “SPEND / DONATE”, “EMERGENCY FUNDS” ,”SAVINGS / INVEST”. As soon as you receive your paycheck you need to segregate it.
It is advisable to put 10% of amount in savings box. By savings box, I imply putting the money in savings account or buy shares, bonds. Invest the money. Dont let it lie idle. Remember the science of inflation, the money kept unused reduces in value over the period of time.
One should put close to 15 – 20% of the salary or earnings into Emergency funds. You can use this amount in the times of needs. This money can be used to meet with medical situations, education of the children etc.
The remaining amount is for you. You can pay your rent, EMI ,buy things etc with it. But, no matter what happens let your savings grow. Do not use the emergence funds casually.
I have started planning my expenses and savings right on my salary day. I separate the amounts of day one itself. Thankfully my wife is a pro in this art. I may take savings casually but she doesn’t. She takes pen and paper and plans out the foreseen expenses. While she does so, she keeps separate funds for movies and entertainment. It’s always good to seek counsel from your wife. That way she feels the responsibility equally. She gets the respect she deserves. By including her in planning your finances you give her a place of equality. That’s a must have thing for a healthy relationship.
I suggest you do the same. It’s the effective way of building a good future for you and your loved ones.
Do write back your views. I would like to learn how you manage your savings.