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The Basics Of Saving and Investment for the Future !

July 17, 2012  by: ushakiran  Points: 12   Category: Investment  Earning $0.85   Views: 999

An individual has to make the future secure and carefree by having enough finances to continue living in the same manner.So it is essential to cultivate the saving habit and start making investments early in life !

         

Money saved and invested is money earned and money set aside gives many options and opportunities down the road .This is an important fact that people need to bear in mind .
It really makes no difference whatsoever how much money you make in life, if you’re not saving a portion of it for your future needs. We must accept the fact that all the great wealth builders out there that have built financial empires and kept their wealth have been and are great savers..

Making sure that you don't spend too much of your earnings on unnecessary things and continuing to save on a regular basis is a good way of accumulating wealth. With some simple investments plans your money will keep doubling after eleven or twelve years at a modest rate of 8 -9 per cent.

Saving for the future is also a way of staying out of debt or getting into financial difficulties of any kind . When you cultivate the saving habit , you are less likely to over spend and become careful with your money.One should always remember that when an individual is short on cash , choosing between an unexpected financial emergency and paying your regular bills can become an expensive choice.When you have your own savings to fall back on there is no need to worry when such things happen in life !

A few simple money saving techniques



Just to make it easy to cultivate the saving habit here are some simple money saving techniques that can really help you put money aside for a rainy day. .

1, According to financial experts , a recommended method of saving for the future is to take 10% of the money you earn each month and either deposit this into a separate bank account or invest in a savings plan. Make sure that you do nott use this account for any of your day today expenditure .Once you see the amount growing, you automatically make sure that you leave it alone and perhaps add more if and when you can !

2,Reduce your spending - One of the reasons why people find it difficult to get into the saving habit is because of living beyond one's means. People who make a lot of money but who don’t know how to save are just at a higher level of “ broke”. Money flows through their life, but nothing ever gets retained. Thereby , Reducing our spending, as opposed to earning more money, is the real key to gaining control of our finances .

3, Start saving while you are still young , even a small amount goes a long way .It becomes a cultivated habit and you have that many more years of savings with you to fall back on during an emergency . At a later stage in life it becomes hard to start saving because of the added responsibilities and expenditure and one may be earning just enough to cater to all the needs.

4, Make up your mind to start saving and the minute you make a decision to save a portion of your income , all of a sudden you find your income increasing because you become focused . Just by setting aside an extra $ 50/ per month into a savings account as a starting point for your savings plan, you will either increase your income by 50 dollars or your expenses will drop by 50 doallrs , it is as simple as that . When you have a limited income you need to cut corners to save part of your income.

5, Set a goal and a target , both of which would help you in your saving habit. What you need to bear in mind is that you dont need to make a fortune , you just need to save a lot more than you spend and accordingly work out a plan.Start by making a list of all the necessary things you need to do with your money also taking into account at least six months of reserves just in case you are out of work for some reason.Once you have written down and calculated the amount needed , all that is needed is to work out the details as to how much money can be put away each month after all the expenditure is met with and deductions are taken care of .Making a list of all your expenditure helps you in curtailing unnecessary expenditure and you know exactly where your money is going and yoiu are able to keep track of your finance.

6, Do not get a credit card unless it is absolutely necessary , as it might tempt you to splurge and overspend. And even if you have a credit card, dont use it on a daily basis , instead make it a habit to carry your debit card to make payments since nowadys debit cards are accepted everywhere and one can only spend what is there in the account. Many people have faced financial difficulties because of credit cards - being unable to pay back the amount on time and having to pay huge amount of interest on the money borrowed ! It is a vicious circle and unless one is very careful in accounting and paying back one’s debts on time, it is better not to use a credit card unless it is an emergency !

7, Be frugal and careful with your money and expenditure - like cutting down on dining out , making a list while going out for shopping and buying only what is on the list, making use of coupons , Christmas and discount sales etc, one can really get into the saving habit. Sometimes you can meet your goals by looking for extra ways of making money as well. There are plenty of opportunities to earn these days if one has the determination to add on to ones income.You can do it sitting at home by pursuing your hobbies and making it into an income generating opportunity.One of my friends who has a large garden runs a plant nursery at home and earns a tidy sum each month, this also makes her happy since she is doing something that she really likes to do !

Most of us are conditioned to earn as much money as we possibly could depending on our capability and once we do earn it we tend to spend it all and enjoy the fruits of our labor. It may sound like a great way to live, but it carries a lot of risk with it unless one makes one’s future secure and carefree by having enough finances to continue living in the same manner.So it is essential to cultivate the saving habit and start making investments early in life !




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