Not being able to save enough: Practical advice to boost your savings

The first stage in personal finance is saving. Only when we start saving does the process of creating wealth begin. The first step in achieving financial freedom is saving. Saving always begins in the imagination before being put into practice. It can be quite tough for many people to give up their current pleasures in favor of an unknown future. They desire to embrace the present and enjoy each day as it comes. It's dangerous to adhere to this philosophy. Giving saving and investing the necessary attention will ensure that we have a prosperous future.

What Saving exactly mean?

The amount of money we have left over after paying all of our bills is what we save.

Savings = Gross income – Gross Expenses.

Most of the time, we only consider saving after covering all of our expenses. Can we truly save money by using this strategy? If we have money on hand, expenses will undoubtedly arise. We need to have a different attitude toward saving. Should we go in the opposite direction? We should, indeed. A portion of our monthly take home pay should be set aside, and the remainder should be spent.

Investment and saving go hand in hand. An investor saves money first, then invests it in other asset types to make money. Through investment, we put our savings to work for us.

As soon as you begin saving, you should begin investing. Your age and level of responsibility will affect your savings rate. People in the 20 to 30 age range can save more money than people in their 40s since they have fewer obligations to their families. In general, you should save between 40 and 50 percent of your net income if you are young, single, recently married, and do not have immediate family responsibilities. After 25 or 30 years, this saving turned into prudent investments will assist to create a significant corpus.

Starting young will put you well ahead of the pack. The compounding factor can be extremely advantageous if you start saving early. Another benefit is that you can start investing with a lower sum and gradually raise it as your income rises. 

The following advice will help you save more money:

• Keep track of your expenses. If you keep an eye on your spending, you can save a sizable sum of money even if you make between 10,000 and 15,000 per month. Expenses are essentially divided into Needs and Wants. We can save a lot of money when we try to limit our spending on wants. Knowing where your money is going will be easier if you keep a record.
• Set up a different bank account. Transfer the sum that you chose. And secure it. This account should not be used for any type of withdrawal. Once you are comfortable with this plan, you can begin investing the money you have saved.
• Divide your spending into these two categories. There are two categories of expenses. Fixed expenses make up the first category. It covers costs like rent, society maintenance costs, education, fixed medical costs, pay for maids, property taxes, insurance premiums, etc. Food, transportation, electricity, telephone, entertainment, groceries, etc. are examples of variable expenses. Focusing on fixed expenses will help you save more money while attempting to cut back on variable costs.
• Classify your expenditures. Spending can be divided into Needs and Wants. You should be aware of your needs and the costs associated with your wants. Spend as little money as possible on regular outings, short vacations, movies, parties, etc. This will enable us to concentrate on your needs while also saving money.
• Create a monthly spending plan. You may start organizing your recorded spending into a manageable budget once you have an idea of how much money you typically spend each month. You can plan your expenditures and prevent overspending with the aid of the budget.
• Savings equals your income minus your outgoings. If you had 100 rupees and spent 80 rupees, you could still save 20 rupees. Here, I'm attempting to convey the idea that saving should begin in our minds and that we should then follow the steps to manage our costs in order to save money.
• Decide what you want to save for. Setting a goal is one of the best methods to save money. Choose your objectives first. Investing aimlessly entails making haphazard decisions that might not be long-lasting and could collapse at any time if an emergency arises. Saving with a goal in mind can make it easier to invest with discipline and focus.
• Choose your top priority. Both short-term and long-term objectives are achievable. Prioritize your objectives and continue saving as needed. Mention percentage of savings along with each objective.
• Make saving simple. Automated transfers between your savings and deposit accounts are available almost everywhere. You have control over the timing, amount, and location of transfers. You can even split your direct deposit so that a portion of each salary goes into your savings account.
• Find practical methods to save money each day. Use public transportation to save on petrol. Instead of a postpaid connection, apply for a prepaid mobile connection that tracks your expenses on calls.
• Examine your routines. Spending money on drinking and smoking is a waste. Alcohol and smoking both slowly kill you, but they also harm your family. Pay attention to your health as it will help you avoid future medical expenses.
• Do not fall victim to the debt trap. Please refrain from taking out any pricey loans to fulfill your dreams. Your savings will be hampered by debt.
• To avoid fees, pay your utility bills on time. Remember the final payment date. Make a note of it on the calendar. Learn how to reduce your energy use and cut your electricity costs.
• Avoid using a credit card. Use a debit card instead, which allows you to check your account balance after each purchase. If necessary, start paying with cash instead of plastic because it hurts more when you do.
• Keep your distance from those around you and resist the urge to flaunt yourself.
• Try and find an other source of income to cover your expenses. You can turn your passions into courses, start a freelance business, participate in the sharing economy, etc.
• Watch your savings increase. Every month, review your spending plan and assess your results. This will not only help you stay on track with your personal savings goals, but it will also speed up the process of finding and fixing problems.

You can reach your ultimate goal by gradually and consistently increasing your savings each year while also seeing an increase in your income.