From no savings to investing | Value Research Read on to know how you can turn around your financial life

From no savings to investing

Read on to know how you can turn around your financial life

Younger generations are not into the habit of saving let alone investing their hard-earned money. They've built the mindset of living for today and not worrying about tomorrow, which is dangerous. Easy credit has added fuel to this fire. It has changed the way people treat money. They are drawn into spending by innovative methods such as credit cards, EMIs and Buy Now Pay Later schemes. This reduces savings for their future.

It seems attractive to shop for shiny new things. But you need to realise how not saving and investing enough can put your future in trouble. As Warren Buffett rightfully said, "If you buy things you don't need, soon you'll have to sell things you need." This is the mantra everyone must understand. One should reduce their spending and start investing for the future and saving is the first step in this direction.

So, how do you begin? First of all, overcome the problem of not being able to save regularly. Keeping aside some money every month must be practised. Once you have that habit built, you can start thinking about investing to grow your wealth.

In the early stages of our career, we earn less and have a lot of essential spending. We might think the small amount we save is not meaningful enough to start investing. But we need to understand that compounding can grow your money manifolds even if the investment amount is small. Developing this belief in saving and investing is important and it has nothing to do with the scale. There are a lot of people who earn well but they don't invest, and there are a lot of people who don't earn so well but are very disciplined about their savings and investments. So, it's more a matter of attitude and habit and you should inculcate that habit as early as possible.

But where do you invest? If you ask your parents, chances are they will nudge you to put money in bank deposits. What you get out of bank fixed deposits is safe and guaranteed returns but this investment is not very desirable in terms of protecting you from inflation. For wealth creation, investing in equities should be a no-brainer. And for starters, nothing beats the convenience of mutual funds to invest in equity. Here, you can start investing with as low as Rs 500 per month. So needing a huge corpus to start investing is not the case anymore. With new technologies, getting started has become easier than ever. If you have a bank account and a mobile phone, you don't even need to leave your house. Everything can be done online these days. Here is some guidance to choose your first mutual fund.

So, what are you waiting for? Just start, no matter how small it might look right now. This investing habit will help you gain experience and make you a wise investor over time. So, the next time you catch yourself splurging money, you know what to do!

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