Saving money is very important when planning for future goals. However, today’s younger generation, including millennials and Gen Z, often doesn’t take this seriously.
If we take a closer look, we see that for the younger generation, instant gratification is often prioritized over long-term financial goals. A common complaint is that there’s just not enough money to save!
But beyond the excuses lies the simple truth that saving money requires almost as much effort as earning it. The world around us is full of tempting offers. Deals like “Buy Two Get Three Free” or “Flat 70 Percent Off” are hard to resist, especially when you’ve worked hard to earn your money.
However, since saving money is crucial, it’s important to understand the value of developing a savings habit. Here are some of the best ways millennials and Gen Z can start saving:
1. Learn to Make a Budget and Stick to It
The first step in saving money is creating a budget. Based on your monthly income, make sure to set aside at least 20 percent in a separate account. Track your daily spending using one of the many available apps and make adjustments if needed. At first, living on a budget may not be enjoyable, but as your savings grow, you’ll feel a sense of accomplishment.
2. Review Six Months of Expenses and Identify Areas to Cut Back
You can save more by either earning more or spending less. Since earning money isn’t easy, the focus often shifts to spending less or spending more wisely.
Review your spending over the past six months and see where you can cut back. This is especially useful for those who frequently use debit or credit cards. Look at your recent statements, and you’ll notice where you’ve spent extra money!
What are extra expenses? These include costs you could have easily avoided. For instance, taking a rickshaw for a 600-meter ride or booking an Uber for a 2.5 km trip. The amount may seem small at the time, but these trips add up. For example, 14 Uber rides at Rs 80 each add up to more than Rs 1,000. This money could have been saved and even invested in a SIP! Millennials and Gen Z should make every rupee count.
3. Use an Automatic Account to Make Investments Easy
You’re likely familiar with the convenience of a pop-up toaster or the microwave that heats food in minutes. These tools make life easier with minimal effort.
So why not apply the same principle to financial investments? Automate your savings as well. Instruct your bank to automatically deduct your monthly SIPs. Over time, you’ll see that this habit pays off, and you’ll have accumulated a significant amount by the end of the year.
As mentioned earlier, saving money requires as much effort as earning it. Therefore, it’s absolutely essential to save money. These tips don’t require deep financial knowledge. All you need to do is be careful with your financial planning to secure your future.
