Many people find it hard to save money after receiving their monthly salary. An average middle-class person in India saves about ₹10,000 a month. But, this is not enough to handle uncertainties. You need to save at least 20 – 30% of your salary every month. That’s why we decided to help you get started and manage your finances properly by compiling the top 10 ways to save money from your salary in India.
Let’s get started.
1. Start Budgeting
This goes without saying. You cannot continue to spend money the same way you did in the past. You need a new strategy that will help you maintain a good savings habit.
How do you start budgeting?
Budgeting is creating a plan for spending your money for a particular period.
To get started, calculate your expected income for the month. If you’re not working at a 9-6 job with a set salary, you can get this by calculating your average income for the last 3 months.
Then, organize all your expenses based on priority. The most important ones (your bills) come first.
The best thing to do is save immediately you receive your income. Then, make a budget for the rest.
Alternatively, you can assign a cost to each item on your list before saving. This should be lesser than you used to spend, so you still have some money left.
2. Save on Transportation
You love going to work in your vehicle. Most of us do. We just want that personal space and comfort in the morning before the hectic day begins.
But, this is not always the way to go, especially if you’re trying to save money from your salary in India. It’s just too costly.
Instead of going out in your car and spending money on gas, take a public vehicle. Enter a bus or cab that will get you to your destination.
You can even start saving money by carpooling. Take a ride with friends, and you can split the fuel costs. These methods can save you good money especially now when the fuel prices are sky high.
3. Get Health Insurance
One thing you should know is that everyone can get sick unexpectedly. You could be well this minute, and feel unwell in the next hour.
You might be wondering how getting health insurance is a way to save money when you’re going to pay a premium on your insurance every year.
If you end up falling ill, you may spend way over ₹20,000 at the hospital. So, paying ₹10,000 or ₹12,000 for your insurance policy is enough price to pay for your health. It’s not a waste of money.
4. Save Money When Shopping Online
Do you just buy any product you find on display? How do you handle online shopping?
The best way to save money on your salary while shopping online is to be conscious of the items you’re buying. Know what you want, and see if it is available at the right price.
You lose a lot of money when you don’t look at the alternatives when shopping online. Compare the prices of various items (especially between Amazon, Flipkart, Tata Cliq), and choose the one that fits your budget. Use tools like Google Shopping and PriceDekho to show one product on various websites at the same time.
To save money when shopping online, you can also use wallets like Freecharge, PayU, and Paytm to get discounts on your transactions and check free shipping offers.
5. Reduce Your Electricity Consumption
You have gadgets in your house that stay on every second of the day. So, your electricity bills keep spiking, and you wonder what’s going on. To save money from your salary and lower your bills, you have to reduce your electricity consumption.
Some of the changes to make in your house include installing LED or CFL light bulbs. These bulbs will save you over 4 times more energy than incandescent light bulbs.
Also, when you’re leaving your home for work or any outing, turn off all the electrical devices like the washing machine, microwave, and television. Especially remember to turn off your wifi router, Alexa/Google home devices. The more they run, the more money you lose.
6. Drop Your Addictions
The only thing addictions can do to you is cause you to keep spending your money. The major addictions we’re referring to here are excessive smoking and drinking.
If you spend time at bars, drinking all evening, it’s time to change. Drinking alcohol is addictive. You never stop going out to get more drinks.
Similarly, smoking cigarette is an addiction that causes even more health problems. Apart from spending money on cigarettes every day, you may have to spend money on various health issues.
Let’s take a look at how much you can save on cigarettes.
Price of a pack of cigarettes = ₹100
If you consume 1 pack per day for a year, you spend a total of ₹36,500 on cigarettes.
Moreover, lung cancer treatment as a result of excessive smoking can get as high as ₹34,00,000 (source – Yashoda Hospital).
So effectively, you save a whopping amount of ₹36.5K per year and 34 Lakh as one time cost! Just imagine the amount you can save across your lifetime 🙂
Related Article – 13 Things to know before buying Term Insurance
7. Save Money on Groceries
Groceries remain one of the biggest channels our salaries pass through every month. At the end of the month, you remove a large chunk of your money to shop groceries for yourself and your family.
Although you have to stay fed, you can reduce the amount you spend on shopping.
Here are some saving money ideas for grocery shoppers:
- Take a list with you when heading to the market.
- Collect a shopping card, so you can get reward points ranging from 1% to 10%.
- Eat before going shopping, else you’ll get more than you originally planned for.
- If you prefer online shopping via BigBasket, Grofers, Amazon Pantry etc, try purchasing at beginning of the month when they give higher discounts.
8. Cut Entertainment Costs
Entertainment is part of life. No one wants to live in a world where nothing happens. You just wake up, go to work, and head back home. That’s not how life is.
We go to the movies, have dinner outside with friends and relatives, participate in swimming and sports clubs, get gym memberships, and even watch Netflix on our mobile devices.
There are lots of entertainment channels, and they are sucking your money.
A good way to save money from your salary is by cutting off memberships that you don’t use frequently. There’s no point paying for something you don’t even look at. Cancel the membership instead of wasting money.
This applies to your gym memberships, streaming channel subscriptions, and online programs among others.
For OTTs, you can also use the trick of getting free subscriptions. Read my article on How to watch Netflix, Amazon Prime, Hotstar and other OTTs for free to know more
9. Save Money on Food
Many Indians spend a huge portion of their income on food. We either eat too much, spend too much, or do both.
First, you can reduce the amount of money you spend on food by cooking your meals to work. Instead of buying food outside, you save up to ₹1,000 each month by taking a plate of delicious home-cooked food to work.
Even when you’re not going to work, you can start saving money from your salary by eating at home. Get groceries and prepare your meals. Eating healthy, home-cooked meals also reduces the number of calories you consume monthly.
10. Automate Your Savings
The best way to save money and not have to worry about it is by making it automatic. Rather than set some money aside after almost spending it all, you should spend what’s left after saving.
Create a separate saving or investment account, and set up automatic transfers of at least 20% of your salary each month.
This money leaves your account immediately you get your salary, so you don’t even know it’s gone. You can’t miss what you never had.
Now that you’ve seen various ways to save money from your salary in India, it’s time to switch up your habits. You can live a comfortable life and still have enough money to spend during emergencies. You just have to stay focused, and follow the tips given above.
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