Impact of regular savings can only be understood in long term. We all have a habit of spending money. From the time we wake up in the morning till the time we sleep, all thoughts which cross our mind are related to spending. If we think about buying something, it requires money. If you want to go out for long drive it requires money. The ads we see on newspaper tempts us to buy luxury items from online stores. Even if we feel like going out for lunch or dinner it requires spending of money. So, we see that thought of spending naturally comes to our mind.
Nobody wakes up in the morning and thinks that I will save this much of money today or I will invest this much of money today. Saving is something which all of us should learn. Saving occasionally is good but it is better if we develop saving as a habit. We should learn to save regularly.
Why it is important to save ? It is important to save because it provides us a cushion for the time when we will face financial problems. We all will go though a periods of ups and downs in life. A wise man prepares for the downs when he is going through the up phase.
We can never foresee problems coming our way, it could be a tragedy like accident or just a financial loss like loss of job or burglary at home. During those times if we have saving with us then it becomes really easy for us to cope with it. We must first calculate the cost of living. For example if we spend 10,000 rupees on average per month on basic necessities then we should at-least have 1,20,000 rupees as savings. It is simple calculation we must have savings worth 12 months of our monthly spend. This provides us peace of mind to live our life and spend without worrying.
A regular savings also help us create a corpus for us. A corpus of money help us in creating wealth for our family or for buying some assets. We can use corpus to buy car or give down payment for our new house. It is always good to have funds at our disposal. We all complain that we are never able to buy a bigger car or a house of our own. The main reason behind being unable to achieve what we would want to have is that we are neither planning accordingly nor saving adequately.
If a person is not in a habit of saving then the first thing he should do is start with some saving plans. One can go for RD or SIP which enables to save money regularly. Then they can improve their financials by adding a good portfolio of funds, shares and insurance. If you are not able to plan it yourself then you must visit any financial adviser for suggestions.
This blog post is inspired by the blogging marathon hosted on IndiBlogger for the launch of the #Fantastico Zica from Tata Motors. You can apply for a test drive of the hatchback Zica today.