The banking sector is presently facing a slowdown, and the current interest rates are so low that returns on FD are insignificant.
The country is keeling under pressure, which existed before the countrywide lockdown. 70% of the banking sector debt has been affected by the pandemic.
Hence, with the current corona-virus pandemic, people have started reassessing their investment options.
Moreover, one should not diminish the essential nature of saving money in this financial climate. Saving money allows you to invest, save up for better things, and protect you from financial emergencies.
Hence, to understand how to explore investment as an option, you need to be familiar with saving money efficiently without making precarious monetary decisions. Here are ten easy ways on how to save more money with these money-saving tips:
Hire a Wealth Manager
Having a wealth manager allows you to plan assets with a long-term goal in mind. He helps apprise you on things such as how to diversify your portfolio of investments and how to save up for retirement.
With a good finance idea, you will abstain from spending paycheck to paycheck as a budding investor.
Spend Less, Save More
The standard advice that chimes among veteran investors groups are that you should curb spending to save up. This approach is one of the essential money-saving tips that allow you to save up for things that matter and invest as well, rather than spend ceaselessly.
Also, this approach may be uncomplicated in words, but to apply requires financial restraint. One of the methods to do this is to reduce your credit card expenses.
Finding ways to make more money allows you to have a reliable amount of savings you can fall back on.
Having a higher income does not mean you use it to purchase more random things. It should be a means to save up and create more wealth without struggling economically.
Diversify Your Funds
One should not put all their eggs in one basket. What diversification allows you to do is find novel ways to invest money by anticipating growth areas. However, if you cash in on one sector or strategy, the short-term gambles do not usually pay off.
Invest In Yourself
This method may seem absurd at first because if one wants to save money, why should they invest? The idea behind investing in yourself is to utilize your savings without risking loss.
But, when you invest in yourself or your business, you get a higher capability of saving money in the future as your business generates higher revenue than before.
Save for Emergencies
Having money saved up during emergencies is crucial to having savings in the first place. If you do not keep a considerable sum for unforeseeable circumstances, do not expect to bounce back quickly.
Aim to Set Aside a Fixed Amount of Savings
Just because you are saving money does not mean that it will be enough to invest later. You should have the intention to use your funds prudently when saving up. Set aside an amount you will not dip into by maybe opening a savings account for that to work.
Make a Budget Plan
Cutting down expenditure requires listing down what comes within your budget. Having a budget plan allows you to not only save money but understand what you need. Making a distinction between wants and needs is crucial as it enables you to have sufficient funds to invest instead of using it up solely on consumption.
Lose Habits and Gain Money
If you have unhealthy spending habits that consist primarily of everyday unrecorded expenses, this point should resonate. As you get in the unending cycle of spending wantonly and not writing it down the endless purchases, you stop tracking your expenses. Lose such habits of spending and start saving up.
Start with low risk investing
Aggressive investing is characteristic of novice investors, but this competition to make more money leads to a poor understanding of the market.
Instead, put your money on leads that are well-researched with good yields, rather than unsure avenues which seem purportedly lucrative.
Why Is Investment a Better Option Than Savings?
An RBI report mentions that large companies have gotten negatively impacted by the COVID pandemic and smaller companies, meaning alternative investment options such as impact investments and Peer to Peer lending in India is slowly becoming viable options.
Furthermore, the current inflation rate (6.7% in August) is not conducive for saving money, as it causes a big dent in your savings, leaving a minute difference between your principal plus interest amount and inflation-adjusted amount.
Due to bank credit going towards a negative trend, the RBI has urged banks to lower lending rates. Thus, people are finding better investment strategies and are aiming for higher returns than a savings account or FD, despite slow growth in traditional investment methods.
Lendbox : A reliable option
Lendbox is a peer-to-peer lending or P2P lending platform that empowers investors to explore an environment to connect with creditworthy borrowers. It provides short to medium-term loans as an alternative to formal credit, which can be a complicated affair for most.
With a transparent, convenient, and seamless platform for availing loans, Lendbox allows lenders and borrowers to interact with quick loan disbursement and processing. Aside from traditional lending, you can also invest in multiple other products, designed specifically for investors with low risk apatite and create a robust portfolio to earn great risk-adjusted returns making Lendbox a very effective low-risk investment tool.
We use big data to understand borrowers spending trends, which allows them to assess their borrowers' creditworthiness correctly and put them through with a potential investor making it prudent for investing. You will get provided a wealth manager to understand the products. To register, you have to provide your KYC information and a one-time registration fee. You get to choose from various products and diversify your investments for better returns at a low-risk. All the variables are taken care of with a dedicated wealth manager, and you can earn up to 2.5 times that of abysmally low returns of FD.
Every month you will receive your returns in the mode of prompt monthly payments. You can even start with a capital of Rs. 10,000 and can expect returns ranging from 12-18%, making it a lucrative venture. Lendbox currently has over 35,000 investors with average returns of 22.41%.