Balancing all one’s expenses, desires and goals comfortably with one’s income seems to have become a never-ending and exhausting task. No matter what one is earning, it never seems to be sufficient to take care of everything. Yet if we look back, we will realise that our parents always seemed to be a lot more relaxed regarding their attitude towards money. Irrespective of their earnings, it never looked like they were constantly walking a tightrope, and yet they managed to provide a lot for us to grow.
While some may argue that expenses weren’t as much back then, the truth is that they were far better at managing and building their wealth than a lot of us today. Discipline, prioritising and an innate ability to invest rather than simply save are some of the major differences in the attitude towards money across these generations. To help you save your money and build your wealth, here we bring you some of the critical money saving lessons we can learn from our parents.
Start with a budget
Most of us will have some memory or the other of a parent sitting at the dining table and recording every expense incurred. Some would even set aside a particular amount that can be spent in a month. As children, these often seemed mundane and irrelevant tasks, but when it comes to savings – budgeting is almost unavoidable. Defining a budget and recording al our income and expenses is critical to identify areas where you may be overspending or expenses that can be curbed. Similarly, by stipulating a specific spending amount one can start saving more.
A penny saved is a penny earned
Whenever you have the opportunity to save money – do it! Whether you have grocery store coupons or saving schemes, every penny counts. Be alert to your spending habits constantly and avoid wastage of any kind. Simple tips like switching off the lights when you leave the room and saving on your groceries can add to your savings.
Pocket the change
Almost all our parents had a pouch or a mini purse where they kept their loose change. Unlike today, it wasn’t discounted simply because it had a lesser value. Start storing all your change and small bills carefully and you will realise how much you can add to your savings each month.
Do not overspend
Swiping the credit card or purchasing something on EMI may seem like the norm these days but is often unnecessary expenditure where you land up spending more in the long run. Debt in any form was almost unheard of for our parents and this is a critical lesson to learn. The interest rate on loans and EMI installments can accumulate to quite a significant amount over time. Instead, opt for purchases that are comfortable and affordable for you. Spend only what you earn and avoid overspending future money before you have earned it.
Make your money earn for you
You cannot earn every rupee you need but if you put our money to good use, it can! Invest your money in the right investment tools and nurture them timely to grow exponentially. A lot of us still put a large chunk of our earnings in a savings account or keep it liquid and overspend. Instead, invest your money as you earn and see it rise significantly.
Discipline is key to success
To get the most of an investment, discipline is a must. Our parents were always on top of their investments and knew exactly when money had to be added to a scheme to enhance its value. Maintaining a strict discipline and timely adding to your investments will take you far.
Plan for your future
Decide the kind of future you want now itself and begin planning for it! Set up a retirement fund or invest in long-term savings that offer you great returns without allowing you to spend in the present. You won’t be able to work full-time throughout your life. To be able to retire comfortably, you need to earn and invest for it now.
Don’t wait to start investing
This may be the most critical lesson of all for better savings – start now! Most people are waiting for the perfect paycheck to begin their investments – but the truth is it doesn’t exist! Start investing today even if it’s with one small investment. Keep in mind that with compound returns your investments can earn a lot more at a faster rate than you. So if you haven’t started your portfolio, don’t wait, start today with whatever you have.
Some of these lessons may sound clichéd or way too simple, but keep in mind that even with a simple life, our parents were able to buy a house, a car and raise their children debt-free. So start investing today and budget your expenses to enhance your savings. Remember, with the right investment tool, a little today can turn into a lot tomorrow!
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