How important is it to save methodically?
Most of today’s young workforce does not give much thought to savings and investments at a young age as there generally needs to have a strong reason behind the same. Initial years are spent in indulging in the new found financial independence. Depending upon the monetary values one has imbibed during childhood, each individual might have a different outlook regarding methodical saving.
In this article, we attempt to address the Why, How, When of methodical savings.
Why should one make savings a habit?
The world today is a platform with endless opportunities. Similarly, the uncertainties and contingencies that can affect any individual is also numerous. Be it one’s health, career, family or wealth, …show more content…
Even though it is a difficult phase, Ashish was able to overcome the situation much smoothly as he had maintained the habit of regular savings for the last 10 years. However, Bijoy could not handle the situation due to his negligence in making the right financial choices and ignoring the need to save money while he was still employed. This is a mistake that most people make in real life.
How much is ideal?
There is no fixed standard by which one should make regular savings. However, if one is in their early days of employment, budgeting 20% of their income towards savings would be practical, considering other expenses and salary levels. One can always increase this percentage as their income grows. It is important to prepare a budget as one can maintain a record of income and expenditures and gain an understanding of their capacity to investment. Even though the amount might differ, it is important that one regularly saves a certain amount.
However, for employed people in the age group of 30-40, it is desired that at least 30% of income be set aside towards regular savings. Methodical savings will aid in facilitating investment towards fulfilling life objectives along with earning positive returns in the long
Most of today’s young workforce does not give much thought to savings and investments at a young age as there generally needs to have a strong reason behind the same. Initial years are spent in indulging in the new found financial independence. Depending upon the monetary values one has imbibed during childhood, each individual might have a different outlook regarding methodical saving.
In this article, we attempt to address the Why, How, When of methodical savings.
Why should one make savings a habit?
The world today is a platform with endless opportunities. Similarly, the uncertainties and contingencies that can affect any individual is also numerous. Be it one’s health, career, family or wealth, …show more content…
Even though it is a difficult phase, Ashish was able to overcome the situation much smoothly as he had maintained the habit of regular savings for the last 10 years. However, Bijoy could not handle the situation due to his negligence in making the right financial choices and ignoring the need to save money while he was still employed. This is a mistake that most people make in real life.
How much is ideal?
There is no fixed standard by which one should make regular savings. However, if one is in their early days of employment, budgeting 20% of their income towards savings would be practical, considering other expenses and salary levels. One can always increase this percentage as their income grows. It is important to prepare a budget as one can maintain a record of income and expenditures and gain an understanding of their capacity to investment. Even though the amount might differ, it is important that one regularly saves a certain amount.
However, for employed people in the age group of 30-40, it is desired that at least 30% of income be set aside towards regular savings. Methodical savings will aid in facilitating investment towards fulfilling life objectives along with earning positive returns in the long