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How to Save and Invest as a Beginner: A Guide

April 21, 2023

Table of Contents

    Table of Contents

      How much money should a beginner save and invest? A complete beginner’s guide to save, invest and grow money.

      “Little drops of water make the ocean.” 

      Well, we must have heard this phrase so often. The catch here is learning the trick to save every single day. Since a small amount of savings can add up and make big money. The idea of savings takes lots of sweat and blood. You need to master your skills in order to save more, spend less and improve your financial prospects. Deal hunting, couponing, DIY’s and learning to invest etc. are some of the common examples of financial skills. Small savings help you in paying off debt, buy your first home, build your investment portfolio, or meet other financial goals.

      Are you a first time investor? Are you looking for money-saving hacks? We are here to assist you in understanding different ways to save and invest your money the right way.

      Do you know that the concept of saving and investing are totally different? Yes…It’s true that they are interdependent. Both saving money and investing money have occupied a prominent place in your life, but they are not the same. Below mentioned are some of the tips that can help you build savings, reduce debt, boost income and invest wisely.

      Let us explore 8 Ways to Start Saving and Investing as a Beginner1.

      1. Automated Savings:

      Automated savings means a small portion of your income is automatically deposited into your bank account periodically. Furthermore, these automated transfers can be directed to savings accounts or investment accounts. Such savings plans are hassle free since manual deposit funds every week or month are not required.

      2. Emergency Fund:

      An emergency fund is the surplus of money that you should set aside from your regular income. Emergency funds act as a protection against inevitable circumstances that can appear without prior warning. By setting aside emergency funds you can easily overcome your monetary expenses. So make yourself capable of paying medical debt by setting aside a medical emergency fund.

      3. Self-Control:

      Sometimes we often end up spending more than required. And by the end of the month we are broke and left with zero balance in our bank account. Such problems crop up when you have limited income and unlimited expenses. Therefore, self-control is the best alternative for pooling maximum savings. Avoid spending hefty amounts for salon treatments, clothing, fast food etc. So spend less to save more.

      4. Lose Some Gain Some:

      Eating restaurant food is unhealthy as well as an expensive affair for any individual. Instead you can cook food at home which helps you in controlling your budget and unwanted calories too. Such practices assist you in pooling your savings to pay-off debts and also in diverting your savings into investments.

      5. Alternative Ways to Earn Money:

      There are many ways to earn extra income either through weekend job and selling or reselling clothing, jewellery, giving tuitions etc. Such techniques are adopted by many youngsters to earn extra bucks to accomplish short term goals like buying a car or a bike.

      6. Start by Small Savings:

      Small savings make a huge difference. Make your money work by saving small portions of your income. In this way you can balance your savings and expenses.

      7. Implement an Investment Plan:

      Investments should be such that assure returns from savings. Investments in the form of shares, equity bonds or mutual funds are advisable for beginner investors. As a new investor you need to be equally cautious since high return investments involve a great amount of risk.

      8. Expert Opinion:

      Seek advice from a professional financial advisor to begin your investment journey. Financial consultants assist you in building a balanced portfolio, in selecting shares and bonds etc. These professionals usually charge a minimum fee for guidance and assistance and help you in gaining confidence to enter the market.

      Saving is the process of keeping aside a portion of present income for future use. And which can be recovered easily or sold in a very short period of time. Bank deposits, purchases of securities, or increased cash holdings etc. form an important part of savings. On the contrary, investing is the process which assures to generate regular flow of income for the current and future use. Investments are usually made in stocks, bonds, equities and real estate etc

      Saving and investing money are the essential ingredients for wealth creation and securing future prospects. They assure to give you protection from uncertainties of life and assist you in enjoying a quality life. Do not delay and make your money work for you.