How to save on your budget🥂

Saving and budgeting can be stressful at first, but having a fixed goal can help you visualize a better future which can provide you motivation. Following step-by-step guide can help you get started on how can you save more on your budget:

1. Maintaining adequate accounts:

Accounting for your own expense can help you to be aware of the exact areas in which you are spending. If you notice some areas in which the expenses are more than you may find alternate and cheaper ways of spending in that area. For e.g.: If the head in which you are spending the most is traveling, you may consider sharing your ride, you may consider not traveling during rush hours in order to save fuel, maintenance of your car will also help, etc. 

Keeping track of your expenses will let you address the problem areas and will help you save in better and efficient ways.

 

2. Bulk buying:

In order to take advantage of this point maintaining your accounts is mandatory. After knowing your major expense heads buying those commodities or services in bulk will help you to save more. MRP of products having larger quantities is lower than that of smaller quantities. Also, as you are having a greater negotiating power, you might also be able to get those products or services lower than their MRP by getting bulk discounts.

 

3. Cost per use:

I remember when I was planning for a trip to the USA I thought of buying a DSLR camera which was $2000. In my entire life, I have used this camera only 3 times making my cost per use of this commodity $666.67! Now when I go back and think had I bought that camera on rent it would have cost me only $200 to $400. And hence before buying any expensive products find out how many times can you use them so that you can save a ton of money.

Use the 100 days rule before buying anything:- (i) Do I need this for the next 100 days? If not, don’t buy it. (ii) Do I have similar item that can serve this purpose? If yes, don’t buy it.

 

4. Record maintenance:

Have you ever faced a situation in which you have bought an electronic appliance but have lost the warranty card due to which you had to spend money to repair it? Or you fell sick but have misplaced the health insurance records? To avoid such situations always keep proper records of medical history, insurance records, warranty, bank statements, ID cards, compliance-based records like PF/ESI, income tax returns, daily expense bills, etc  

 

5. Savings formula:

Savings ≠ Income – Expenses

Expenses = Income – Savings

“Don’t save what’s left after spending, spend what’s left after saving”- Warren Buffet.

Have a clear idea of how much you wish to save and then allocate you income towards the expenses you have.

 

6. Automate your bills:

Companies frequently charge you late fees if you don’t pay them on time, so paying them before the due date will help you avoid any additional charges.

 

 

7. Cut back on rent:

Rent contributes to a third of your expenses. If you are currently living alone consider a shared apparment, if you alread live in a shared appartment consider shifting to a smaller appartment in order to save your rent.

 

8. Reduce your utility expenses:

Try to reduce your fixed cost by following simple steps like:

- Swap your light bulbs by LED lights to save more energy.

- Seal up any air leaks in your house so that your heaters will have a longer run to keep the room warm without over using electricity.

- Cancel subscriptions that you don’t need like magazines, OTT subscriptions etc

 

Hope this helps you to achieve your short term and long term financial goals. Keep savin and keep investing!!!!

- harsh himanshu soni