16 MAY 2017
5 Powers in your Salary
There is always a sense of joy on getting the salary credit message from the bank. Often, you wish to splurge it all on in obtaining instant gratification but this will threaten your long-term financial security. By following few basic steps, you can ensure financial stability along with short-term satisfaction.
Your salary has 5 hidden powers:
- Living Expenses
The cost of living is increasing day by day. Living expenses will occupy a major chunk of your salary. Set aside 50% of your salary for this; this will include your rent, paying the bills, and food. Ideally, try spending less than 50%; once you get into the habit of buying things which you need and not which you want, your expenditure will decrease significantly.
You must allocate a minimum 25% of your salary to your savings as this is a crucial step towards ensuring a financially secure future for you and your family. In the initial stages, allocating 25% of your salary to your savings may be difficult, but with time and self-restraint, you will find it easier to save money. Remember, to save first and spend later. Your savings should be invested to get optimum protection and returns on it.
With a population of over seven billion plus, there is immense competition in every field. There is a need to be better than the rest, to stand out in the crowd. This is why education has become very important today. Every parent strives to get their child the best education that there is. As a result, due to the increasing demand, the cost of educating a child has increased significantly. Ideally, you should allocate 10% of your income for the education of your children.
Since you have been working so hard to provide for yourself and your family, you deserve to indulge in little joys such as weekend trips and dining in your favourite restaurant. Life isn’t all about work; you should enjoy your life too and paint it as a canvas exploding with bright colours. Set aside 5% of your salary for your enjoyment.
The remaining 10% of your salary should go towards securing the future of your loved ones in the unfortunate circumstance when you’re not there to take care of them. Insurance takes care of the financial well-being of your loved ones when you’re not there.
18 JAN. 2018
Benefits of Early Financial Planning For Parents
As a parent, you must know the significance of savings in daily life, but what about the future? As unfortunate events like death can occur anytime, you have to ...read more
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