Follow These 4 Rules To Save Money and Become Rich
Sometimes even smart people do stupid things while spending their money. These people usually face budget leaks because of their careless spending that adds up over time. You are not able to notice and these spending holes drain out all your hard earned money. So, here are the four common ways how people waste their hard-earned money and how they can stop it.
Stop giving in to instant gratifications
Saving money is also a form of earning money and if you want to save money then you need to stop giving in to the instant gratifications. Instant gratifications can be anything like eating out in a restaurant, buying a recently launched smartphone or it may be going on long trips on the weekend.
But before you spend your hard earned money on these useless things, ask yourself a question whether spending money on these things is required or not. Many of us spend lots of money as our friends, close family members or acquaintances are doing the same. Anil Rego who is a Founder and CEO of the Right Horizons states that a person shouldn’t spend money because of the pressure of the society.
Make a simple budget and follow it
If you want to avoid wasting money then you just have to make a budget before you receive your salary or monthly income. The list should include the must-do expenses in it and throughout the month, tick off the mentioned expenses on the list one by one.
Once you learn to stick to the budget list, you will start saving some money. Try not to spend the saved money or you may spend a small portion up to 5 to 10 percent of money as a reward for maintaining the discipline. If the saved money is invested properly, it can lead to the creation of wealth in the future.
Invest your money smartly
The rich people follow the rule of saving 50 percent of their hard earned money and they invest the other 50 percent in the avenues where they will receive good returns. If you are a fan of Netflix then you should know that only by saving and investing the monthly Netflix charge of Rs. 800 for thirty years can help you accumulate around Rs. 55 lakh. Invest a bulk of saving in equity/stock-linked products if you are below the age of 30. But one should avoid investing in the real estate with 5 to a 10-year term and should rely on other better options.
Try to remain free from debt
The rich people always try not to carry any debt on their heads. Many industrialists are not personally declared bankrupt even though they run debt-ridden companies. But a common person only takes a loan only when they don’t have any money left to spend. If you are paying off your debt with hefty interest which is ultimately deposited in a bank then you will never be able to become rich.