You’ll agree with me that it is very difficult to Save Money considering all the different types of expenses in our day-to-day life.
In fact most of the times we spend more money than we actually earn.
But when it comes to financial bearings, saving money is so hard!
It just requires a proper understanding of the Money Management.
Fact is: Every Money Saved = Money Earned!
India has the world’s highest per capita savings rate per household- which is a whopping 30 percent.
This is because of traditional insecurity that exists over finances plus the burning desire to build wealth for the future.
Understandably, you may be saving a considerable amount of money every month.
However, there is sufficient scope to increase savings and utilize the money for investments that will fetch great returns.
Here we look at not Just 1 but 10 tried and tested Money saving tips in India.
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Top 10 Proven Ways to Save Money in India:
1. Avoid Credit Cards
Nowadays every major bank offers credit cards to the salaried class who earn above a certain amount.
Credit cards are an excellent option when you do not have sufficient cash to make urgent purchases, counter emergencies or spend while travelling. However, credit cards come loaded with heavy interests.
Generally, banks allow you to pay between five and 20 percent of your outstanding amount on credit card every month.
The unpaid amount accrues interest. On paying the minimum amount during the next billing cycle, more interest gets added. Often, people end up paying more interest than the value of the purchase.
Credit cards also tempt holders to indulge in extravagant and frivolous spending.
This increases your outstanding amount and leaves you saddled with stuff that may have little use in your daily life. Credit cards are great only for people who have a tight hold on their purses.
2. Save With Bank Accounts
Post-November 8, 2016 demonetization of Rs. 500 and Rs. 1,000 notes, a slew of banking reforms were introduced by the Indian government.
These include a cap on a number of free withdrawals from your bank account, charges for not maintaining minimum balance and transactions conducted through ATMs of other banks.
Bank transactions also attract 18 percent Goods & Services Tax (GST).
You can avoid these unwanted expenses by holding two or more bank accounts to deposit money required for spending.
This way, you get more free withdrawals that eliminate charges for exceeding the limit for using at other bank ATMs.
Also, open zero minimum balance accounts where possible or look for banks where the mandatory balance is very low. This way you can save money on monthly salary.
Nowadays, banks decide minimum balance based on branches such as rural, semi-urban and metro and these banks providing the best savings plan.
Minimum balance requirement for bank accounts in metro cities is higher. Failing to maintain attracts penalties ranging between Rs. 75 to Rs. 250 depending on the bank.
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3. Cable TV and Direct-To-Home TV
Cable TV and Direct-To-Home satellite channel providers create channel packages that deftly blend popular ones with those you will seldom view.
Consequently, you end up paying a lot more to subscribe to cable TV and DTH channels. Having over a hundred channels on your TV is useless even for the most avid viewer or couch potato.
Review the channel packages you are currently subscribing. Find out how much time you spend viewing a particular channel.
Discontinue subscriptions to packages you rarely or seldom view.
Additionally, you can also compare channel packages offered by cable TV and DTH providers and select the ones that are economically priced so that you can save money every month at home and best suited for your home entertainment needs.
4. Bancassurance v/s Traditional Insurance
Bancassurance means various insurance products offered by banks in India through their Non-Banking Financial Companies (NBFCs) and Joint Ventures (JVs).
They are available at economical premium rates as compared to traditional insurance policies which involve buying through commission agents.
Excellent examples of Bancassurance in India include Star-Union Dai-ichi, a JV of Bank of India, Union Bank of India and Dai-ichi insurance of Japan, IndiaFirst offered by Bank of Baroda and Andhra Bank, PNB MetLife by Punjab National Bank and US-based insurer, MetLife.
These insurance policies providing the best saving plan are also available at very reasonable premiums and high returns from banks for customers and non-customers.
5. Use Budgeting Apps
India is expected to have nearly 600 million smart-phone users by end 2018. There are excellent budgeting apps that you can download from Google Play for Android and Apple Store for iPhones.
These apps have proven to help people worldwide save money they inadvertently spend.
You can download any of these great apps on your smart-phone. Most apps allow you to allow a specific budget under various heads like ‘Food’, ‘Telephone,’ ‘Education,’ ‘Healthcare’ and others.
The moment your spending is nearing the fixed limit, the app automatically sends an alert.
Further, these apps also help you review your daily spending and help identify areas where you could have curbed or eliminated expenses.
Reviewing your own spending patterns on these apps helps you to draw more astute budgets that help save money.
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6. Save on Commutes
India has one of the highest commuting times in the world. In some metro cities, people spend as much as two hours commuting between home and workplace.
There are many ways you can save on commutes. Where possible, request your employer for posting at a nearby branch or office of your organization.
This means you spend lesser time and money on travel. Buying monthly and quarterly passes on mass transit systems such as state-owned bus services and Indian Railways trains and shuttles helps save a lot.
Where possible, you can also look for car-pools. This means you can travel comfortably without the hassle of driving and incurring heavy expenses on fuel.
Sharing a ride in cars or two-wheeler also helps save considerable money on fuel.
It is also worth remembering that tires with wrong inflation pressure can cause your vehicle to consume more fuel.
Unless your vehicle engine is well maintained, you may be inadvertently spending very high on gasoline. Have your vehicle serviced regularly to save on unnecessary fuel expenses.
7. Save Coins and Specific Notes
This is one of the best ways to save money. Collect all the change you collect during your day.
Also include currency notes of specific small denominations such as Rs 5, Rs. 10 or Rs. 20. Keep them in a small piggy bank or box.
While you will not miss the small amount you put away daily, the money you will have accumulated over a period of time- for example three to six months or even a year- will be really large.
This money can be invested in buying savings products or other schemes that help you grow wealth.
8. Buying Groceries Online
The online grocery market in India is rapidly expanding with newer players emerging. Well established online stores such as Amazon now offer Amazon Pantry service that sells groceries priced lower than what you would pay in brick-and-mortar stores.
However, saving money by buying groceries online requires some efforts. You will have to compare prices between two or more e-retailers and find out who can fulfil your shopping basket at the lowest price.
Further, you also need to know the difference between the prices advertised online and those prevailing in your neighbourhood store.
Shops also give discounts nowadays to counter the low prices offered by e-retailers. The best way to save on shopping is by drawing a proper list and comparing prices.
Also, look for online stores who offer free deliveries. Often, delivery charges can negate your savings.
9. Save on Utilities
A common blunder that most Indians make is leaving on electric bulbs, lights, ceiling fans, TV sets and other electronic devices operating even while they are not required.
Utility providers will charge you for every unit of power consumed, regardless of how you used it. High electricity bills are a major cause for drop-in savings.
You can also save money on electric bills by using power saver lamps, keeping your refrigerator set to the right temperature according to the load.
Leaving water heaters on while not in use is also a major culprit for high electricity bills. You can save money in India by taking these simple precautions. Computers and laptops left on also guzzle electricity.
10. Save on Travel
You can save a lot of money while going on holiday alone or with family. This is made possible by proper planning of your holiday and fixing a budget.
Nowadays, you can get excellent offers for hotel accommodation and airline tickets online.
Most hotels and airlines provide something called ‘early bird discounts’. This means you can get airfares at almost 70 percent cheaper than regular market rates for buying confirmed tickets early.
Booking hotels well in advance and by v bargaining rates with their property owners also help save on vacations.
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Saving money in India is possible in many other ways too. For example, investing money in tax saving Mutual Funds, insurance policies, post office schemes and government bonds helps save Income Tax.
Nowadays, all mobile networks offer economically priced packages that include high-speed Fourth Generation (4G) Internet service provider mobile access and unlimited free local and Subscriber Trunk Dialing (STD) calls and text messages.
This helps save money on telecommunications and Internet. You can utilize some or all of the money saving methods we highlight.
The money saved can be put to work to increase your personal wealth for a happy future.