Save for rainy days. Save for days when there’s sunshine and hay
Money is a great enabler. Perhaps the greatest ever. And ironically, its true value and importance is realized only when one does not have it.
Spending money wisely and saving it are probably the only ways to ensure that this precious resource is continuously replenished.
Judiciously saving money is an advice relevant for everyone, but more so for the younger generation, especially the students. Saving money regularly from a younger age compounds to a substantial corpus by the time they are in their 40’s.
How to go about it?
Let’s say you are a 16-year old college student, receiving pocket money from parents. Or you have a generous grandparents, uncles and aunties. Take away half of what you receive as a gift of their loveand invest it. Since you are a minor you can’t open a bank account, fixed deposit or invest it elsewhere. Your parents / siblings can help in identifying the right place to invest your money.
There’s no point in keeping your money in a ‘piggy bank’. It won’t multiply on its own. Chances are, you will end up spending it!
If you are a working student, studying abroad and involved in a part-time job, you can use the 50-30-20 formula.
Put aside 50% of your part-time job earnings towards paying your student loan, or returning it to your parents – whichever the case would be. Use 30% for your expenses and save the remaining 20%.
Make saving and investing a habit. Do not liquefy the investment ever. At least not until you are in mid to late 30’s.
There will always be an impulse to break the habit of investment. Always. Such is the nature of wants. But if you can practice discipline and be patient to let those momentary impulses to wean away, you’d have become a millionaire or more in a decade – just by developing a habit of saving!