From early childhood, financial security and the value of money gained by struggling are rooted in the average Indian mind. Before we learn how to spend money on what we want, we will learn to save money in our piggy bank. We will grow by listening to parent’s advice to save money by investing money. However, the increase in young people in India has problems in fiscal management.
Recently, an application for a personal loan from young workers in excess of 50,000 rupees in February has been dismissed. He worked at a powerful global consulting company but lived at home, but he could save only 5000 rupees a month. As a result, financial institutions were convinced that they could not afford the loan. In addition, by rejecting the loan application, opportunities to acquire future loans have further declined.
Surprisingly, despite stable employment and adequate income, the monthly savings rate for young adults is less than RMB 5,000. My social circle is repeating the same fight again. Even if I meet friends, colleagues, colleagues, family, young people and young people, I misunderstood management, savings responsible borrowing.
The center of this fight for most young people is that they can not understand and manage finances because of insufficient financial education. Unlike the West where high school financial education has been started and structured, financial education in India is usually taught to parents’ children, and usually begins to work. Until then, most young people give personal finances and decisions to their parents.
At the same time, today’s young people can access various consumer habits such as online shopping, entertainment, recreation, food and alcohol, delicious trips and so on. As a result, most people invest only with a small part of their revenue saving, managing credit card payments and student debt difficulties, and often go to parents to gain the value of their money . Temporary relief measures.
The check from this salary, no savings, occasional credit card use lifestyle can truly hurt people’s creditworthiness. This means that in medical emergencies, it may be difficult to get a mortgage, student loan or loan.
Here are five tips for better managing your personal finances.
Find a leak on your boat: Record every small purchase every day – random coffee, go home, a short weekend vacation. All these small expenses are expensive. Please note where you save your entertainment, lifestyle, hobbies.
Plan all your recreational expenses: You can see how much you spend on leisure and recreation such as travel and guitar lessons. By creating a budget you can prioritize your needs and save money while allocating money to hobbies, interests and passions.
Create a basic investment portfolio: We start by allocating some of the salary to a time deposit that provides higher interest rates than a simple savings account. By learning how to save research and development costs, you can switch to other financial products such as low risk mutual funds, low risk, high yield bonds.
Create a credit profile: If you are considering purchasing a car, family, or student loan in the future, first create a trusted credit history. You can do this with a small personal loan or credit card. As you pay the purchase of your credit card or credit card in a timely manner, you accumulate a positive credit history and banks are more likely to lend at lower interest rates in the future.
Invest time to improve financial IQ to build financial IQ and make smart financial management methods smarter. You can get basic knowledge by reading books and resources online, but you can learn from financial decision-making and advice by discussing with experienced investors and financial experts in social environments . By expanding your financial literacy you can make sound financial decisions from a young age and later avoid new arrivals that need to make more difficult decisions.
To build a healthy financial habit, you need a lot of practice and perseverance. Over time, you see the results you want, there are health spending and saving customs.