Have you ever done a ‘moonwalk?’
No, not the one on a real moon. But the one those hip-hopers do on the dance floor. Have you ever tried to copy the hip-hop sensation, Michael Jackson?
Since 2009, Michael Jackson ruled the minds of each and every man on this planet with his brilliant and smooth dance moves. However, he made even bigger headlines after he died. While many people thought that MJ was a millionaire, he was drowning in debt.
The dancer, who charged millions of dollars for a single dance performance, owed $500 million to the banks. This is the best example of how a person’s lifestyle choices can impact his long-term finances.
If you are planning to take a personal loan for a wedding or home renovation, then you need to read this blog thoroughly.
How Do You Spend Your Money?
When you see that beautiful white dress on a mannequin, you are eager to swipe your credit card and own that piece. However, do you think about how many white dresses do you own? Before you think buying any new thing for your home or your personal use, you need to ask yourself, “Do I really need this? Can I survive without this thing?”
How Much Do You Save Each Month?
Let’s suppose your annual in-hand salary is around 4LPA. How much should you save each year?
If you have never thought about this question, then chances are that you won’t be able to save anything by the end of each year. However, if you think of saving even ₹1,000/month, then you will have some funds to fulfil your emergency needs.
For example, if you save ₹2,000/month, then by the end of each year, you will have ₹24,000. With this money, you can buy a new phone, start saving for your dream bike, or even use it to pay off emergency medical bills.
How to Make a Financial Budget?
Have you heard about ‘Finance with Sharan?’
No, this is not another blog to convince you to enrol for that masterclass. That’s because you can get all that knowledge for free. Do you know how? You have a tonne of free resources like YouTube and podcasts.
For example, you can just type this in the YouTube search bar: “How to save my salary?” After you search for this, you will have at least 100 videos explaining to you how you can save your monthly salary.
First Priority: Repay your Debt
If you have a loan pending, then repaying the same should be your first priority. Do you know why? That’s because if you pay-off the loan, then you will be calm and peaceful, as you won’t be sitting on a ticking bomb. However, if you chose to miss that EMI and pile it up, then regular calls from your banks and money lenders will disturb your mental peace.
Start an SIP
Do you know you can start an SIP with just ₹1000/month? Now let’s suppose you start investing ₹500/month in an SIP scheme. This fund is giving you an approximate rate of interest of 12%. Then, after 10 years, you will have ₹2,32,339 in your fund.
It’s worth noting that you invested only ₹1,20,000 and earned an extra ₹1,12,339 on this amount. Interesting, right? So, start investing now.
Conclusion
In short, even if you are earning just ₹25,000/month, then you can have a safe and secure 50s. And it all depends on your lifestyle choices. So, why don’t you start following on the tips and tricks mentioned above?
