Money is an important aspect of life. Earn money to live. But to live to earn may lead us into troubles. At the same time we should not misuse money. Extravagance in any way is harmful. Saving whatever we can spare is the most necessary habit needed for everyone. It is not enough just to save. We have to be smart enough to get the maximum out of the savings. It needs some diligent work on saving.
Here are five tips for your smart saving. There is a difference between savings and smart savings. By adapting these following five tips we can reap remarkable benefits.
1) Never dump your savings in a savings bank account
Savings bank account might offer convenience for an easy access to operate. But it always better not to dump all the savings just in the ‘saving account’. Though liquidity is important, it does not make the savings bank account the best. Maintain a reasonable amount in the saving account so that it will be helpful to meet your regular expenses and emergencies. It can be a temporary place to invest additional amounts judiciously. The lowest interest rate does not make our saving a smart one.
2) Manage your money with a proper plan
Planning is very important for every walk of life. So also is with the saving habit. You should have a financial plan. You should have realistic goals for which you can allot your savings. Managing money without proper planning will end in unnecessary troubles. A good plan will steer your saving habit with a clear view of saving and spending. Cut unwanted or unnecessary expenses. Allot your savings towards achieving your stated goals.
3) Investing money on just hear-saying is suicidal
Never invest any money based on hearsay. You should always remember that your money should not be idle. You should have the freedom to invest understanding the risk-factors well. Your investments should be triggered by your planned needs. There are brokers and investment agents who may try to snare you promising you attractive freebie offers! Remember that they are more particular about their incentives and commissions than your benefits. Always go for credible and qualified investments.
4) Spread your investments
It is better to invest your money in different schemes instead of having the whole amount in a same place. Diversification is the key of investment. Even if you want to avoid risks and prefer an assured return, it is advisable to broaden your horizons by investing across products in fixed deposits and small saving schemes.
5) Never fail to keep track of your investments
Watch carefully the inflow and outflow your investments. Follow the market conditions, interest rate fluctuations, inflation rate and many other factors have an impact on your investment. You should have an assurance that your investment keeps on working for you.