Beginers Guide to Financial Happiness

I have been busy these last few days with work, visiting relatives and taking a short break ! More about that later. But I have also been busy visiting personal finance websites & blogs. Some inputs I have gleamed from relatives & friends.

I am listing down some of the things I have learnt in the past few days. Off course the journey of personal finance is a continuous one and needs to be updated. regularly. For people like me who are financially illiterate, personal finance / finance seems daunting. But I have realized that personal finance is some bits financial knowledge with a lot of common sense thrown in:)

So my random list of my new founded learning is as follows -

1. Use your ATM card wisely - If you are prone to visiting your local ATM so often that the watchman knows you by name, control yourself! Withdraw a sum weekly to start with and discipline yourself to not withdrawing cash on a regular basis. My bank’s ATM is two minutes away from my office, so some of my colleagues and I have got into a habit of running to the ATM. Money is available and how. And when we aren’t withdrawing money we are busy swiping the card!

2. Pause before you swipe – Its oh so easy to swipe your Debit / Credit card nd forget..but uncontrolled spending ensures that your bank balance diminishes even before you realize. Plus if you are the type who doen't pay your credit card dues on time, imagine the colossal waste of money in paying late fees / inerest etc . Once again discipline is the key!

3. Utilize your savings bank account - Keep saving whatever you can. Or try putting in money whenever you get a bonus / cash gifts or get your conveyance / mobile reimbursements. With RBI ruling that Savings bank accounts will earn more interest from next year, think of the passive income you can generate.

4. Cut your spending & Pay bills on time – Start trimming unnecessary expenses. Every penny saved is going to benefit you one day. Also pay your bills (utilities/ mobile etc)on time to avoid late fees.

5. Start a PPF account - Every little you put away for retirement will just increase your financial security. And PPF is one of the best options. On an average, if you put in Rs.70000/- per year for 15 years along with the interest you are looking at accumulating nearly Rs 21 lakhs (or more)!

6. Make a budget and stick to it - Analyze your expenses and make a workable budget. The mistake most of make when we start on a budget is that we make one which is not realistic. If I know I spend Rs 5000/- a month on commuting, (taking cabs to work and back) it’s unrealistic to think that I will take the train and share an auto all of a sudden. The realistic way according to me is to start with taking a cab to work one time and try the train / bus during the commute back. Likewise with other heavy expenses. Once we see the difference that we have saved at the month end, it will motivate us to the next level.

7. Update your resume regularly – Though its hard in today’s time to get offers, it’s a cardinal sin to send a dated resume (which supposedly many people do!) Network well and be open to offers. After all one never knows when layoffs may happen

8. Retirement Planning – Plan for your retirement today! It’s easy to relegate retirement planning to the back burner, but starting young is going to benefit only. Go through various plans, speak to friends & family or take the help of a professional financial advisor.