Financial freedom is one of the things which we want early in our life. It is something which is capable of to fulfil our desires and dreams, responsibilities to our dear ones and a lot more which we can’t even imagine. But, it can’t be achieved by an individual overnight. It requires smart planning and consistency to follow that plan. Consumption of time of that plan depends on your goals to achieve.
For, most of the working-class people, financial freedom is a dream that they want to achieve, but due to the mismanagement of their salary, they can’t be able to achieve.
There are two important things to remember to achieve financial freedom. One is saving and second is an investment. If you are a monthly salaried employee, then you must save money from your salary and invest that money in a different place to get a high return. It is the simplest and only way to get financial independence.
Here in this article, we are discussing the money-saving tips from salary and investment of that money.
• Make a budget of monthly expense
If you really want to save money from your salary, then the first step is to track your finance. The best way to track your finance is that make a budget for your monthly expenses to visualize the cash flow from your salary.
Once you make your budget, then decide how much amount you need to save to reach your goals. And according to the expenses, you can increase or decrease the amount of savings.
• Finish your debt soon
Debt is the major hurdles to reach our financial goals. To increase the savings from your salary, you have to first finish the debts which have higher interest rates. Simultaneously, finish all debts you have in the sequence of higher interest rates to lower interest rates.
• Increasing the earing amount
If you realize that your current salary is not enough to reach your financial goals then you must be increasing the amount of your monthly earning. You may take an extra part-time job or find some work online.
• Keep your expenses limited
One of the best ways to increasing your saving amount is the cut the budget of your monthly expense. We all know, we have bought lot of unnecessary stuff every month. This habit of ours just wastes our money.
So, if you are not going to buy those stuff which is not so much necessary for you and your family, it will help you to save more money from your salary.
• Spend smartly on entertainment
After spending hours in the office, we all need entertainment in our lives. But, if we have a goal to meet our financial independence, then we must use our money smartly on entertainments.
For example, we don’t need to go to theatres to watch movies every weekend of a month. Instead of we can watch movies on Netflix and go to theatres only once in a month. Then it will save a lot of our money.
If you are completely depending on your saving to reach your financial goals, then I have to say that you are made a mistake. Savings can’t multiply your money, it just gives you an amount of interest. Investment is the best option to gain a huge amount of profit from your money. Here are some investment tips –
• Equity mutual fund
It is one of the best investment options for young starts who is just start earing or low salary individual.
You can invest in this fund either by SIP or lump sum amount. Annually you will get a return of a minimum 15%.
• Debt Mutual Fund
If you don’t want to take a risk by investing your money in equity mutual fund, then you can invest your money debt mutual funds. Here, your money is invested in government bonds or securities. It is less risky and will give more return than FD.
• Public Provident Fund
It is a long term investment option with less risk. The maturity period of this scheme is 15 years. This scheme has a minimum investment amount of Rs.500 to 1.5 lac. Since it is backed by govt. of India, so you don’t need to worry about your money.