Saving from the beginning of your career
We all have dreams about our first salary. Earning and becoming independent is a bridge to living the life you want. It is also a way to become responsible and start saving. Not everyone manages to save at a young age but if you save a little amount every month, it translates into a considerable amount after a couple of years.
There are many financial instruments that you can use for saving and investing such as mutual funds, fixed deposits, equities, bonds and insurance. Some simple short term options could be putting away certain amount of your salary in the beginning of the month, budgeting your expenditure and using cheaper modes of transportation. Colleges could also take initiative by teaching students the importance of saving and exposing them to various options. Here are some advantages of saving a small amount each month:
- Higher education: You can take up a job after graduation, gain some experience and then go for a higher degree after a couple of years. Saving for a particular purpose will also keep you focussed during your work years. You will start thinking more seriously about your future. It will reduce the financial dependency on your parents or a loan for your higher education.
- Dealing with a sudden financial need: Reserve money in the bank helps in dealing with financial emergencies such as medical situations. You may lose your phone and need to buy a new one or need to buy books before an exam. It could be unexpected travel or household repairs. It is always helpful to have a little buffer in terms of your funds.
- Comfortable middle and old age: By starting early, you will have enough by the time you reach middle age. You can have a more comfortable life then. Handling financial stress when you are younger is easier as you are not responsible for a family at this stage. You can work around a budget and manage your expenses. In old age your medical bills will be higher and you may have to employ people for domestic work as well. A considerable reserve of money is vital for a peaceful old age.
You may face certain challenges such as cutting down some habits and dealing with peer pressure. You can try motivating your peers to save too! This is not to say that you should be too hard on yourself. If you want to travel or pursue any hobby, find ways to do it. These may be things that keep you going, stress free and eventually result in your success. So don’t feel constrained and lead your life the way that makes you happy!