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This 6-step plan will point you in the right direction so you can live the life you want. And with a solid plan in place, you won't need to compromise too much on your lifestyle today.
Budget and track your spending
The first step towards finding extra money to put away for the future is to track your spending. Looking closely at what you spend on bills, household expenses, food and entertainment is a good way to spot savings opportunities.
Consider living more within your means to save money on rent, or negotiating your contract. Look into switching mortgage rates, or remortgaging your property, to find a better deal on interest rates. Cutting your weekly shop or cancelling unwanted subscriptions are other simple everyday hacks that can lower your expenses.
If working from home is an option, doing so more often could save you money. You'll also avoid the headache of a busy commute. Ask if your company offers transportation benefits for employees, and whether these can be excluded from your gross income to save money.
Whatever ways you find to save, remember even small amounts add up. For example:
INR500 a week = INR26,000 a year
INR1,000 a week = INR52,000 a year
INR2,000 a week = INR104,000 a year (approximately)
Learn more: How to tell if you're financially fit
Making coffee or lunch at home is cheaper than buying it out - we all know this. But don't feel like you need to sacrifice all the things you love on the way to achieving financial freedom.
Spending wisely could make a real difference to your future lifestyle. So, beyond the essentials, aim to put your money towards things and experiences that really mean something to you.
And, remember, cheaper isn't always best. If you spend a little more on things like clothes, furniture and household items that stand the test of time, it could end up costing you less in the end. Plus, it's better for the environment.
Setting aside any money you save – either in an investment or savings account, or a retirement fund – could also mean you can enjoy more of the things you love in the future.
Remember the flight attendant line about putting on your own oxygen mask first? Well, it's the same with savings. Setting up recurring payments or standing instructions to pay bills is the norm. So, why not make paying yourself a priority too?
By setting up a standing instruction for your savings to go out on the day you get paid, you'll be doing yourself a big favour. Depending on how much you set aside, you'll soon get used to having a bit less to spend every month. And you'll be surprised how quickly your savings start to build up.
A sole or joint savings account can be opened by residents 18 years and above (other eligibility criteria may apply). Why not start earlier? As an HSBC Premier customer, you can open a joint savings account with your under-18 children. Premier NextGen then gives your kids exclusive Global Premier benefits from ages 18 to 30.
Paying into a pension may feel like the last thing on your mind if you're struggling to pay the bills. But you're never too young to start saving for life after work. It's important to remember that the money you put away now could be worth so much more in the future.
Pensions offer tax advantages over other forms of savings. If you're lucky enough to be auto-enrolled into a workplace pension or have chosen to take advantage of your employer's provident fund, you'll already be benefitting. That's because both you and your employer will be co-contributing to your pension.
If you're self-employed or don't want to solely rely on your workplace pension, you can set one up yourself. There is a wide range of pension providers and options to choose from that could guarantee you a regular income stream, post retirement.
Investing offers your money more potential to grow and could be a way to make it work harder. Just remember that investments can go down and up, so you could get back less than you invest.
Your money's not locked away – you can access your investment if you need to. However, you should see investing as a longer-term option for your money and plan to leave it invested for at least 5 years. This gives it the chance to recover from any dips in the market.
It's a good idea to have an emergency fund of around 6 months' living costs in place before you begin. That way if you lose your job or get an unexpected bill, you shouldn't have to dip into your investment.
If you're new to investing, we can show you where to begin. And it doesn't cost much to get started.
The future can always feel uncertain. Especially, if you don't know exactly what you want to be doing in 10, 20, or even 30 years' time.
Reviewing your investments every year doesn't mean you have to take your money out. An annual check up does, however, give you the chance to reassess your goals and make adjustments where needed.
By starting as early as you can, finding ways to put money aside and contributing regularly, you can give yourself more options for a financially secure future.
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