Start on a savings plan!

By | January 27, 2012

Photo credits : Matsukawa

In this era of recession, deflation, and job cuts, it is especially important for you to consider where your hard-earned money is going; financial security is the key in today’s unpredictable world. And the first step towards gaining that security is to have a saving plan.

Do you have money put away for a rainy day? How will you manage if there’s a family emergency? What about a down payment for a home, or a fund for higher education, or retirement? Do you have loans to repay?

In this era of recession, deflation, and job cuts, it is especially important for you to consider where your hard-earned money is going; financial security is the key in today’s unpredictable world. And the first step towards gaining that security is to have a Saving Plan.

Still not convinced? Then ask yourself why you need to save. The answer’s really very simple: so that your money can start earning money, and work towards reducing the effort you put in everyday.


You might wonder how to begin saving if your income is already over-committed. Efficiency and discipline are the answers.

  • You need to first find out where your income is going. Maintain a diary for the month, noting down everything you spend on, to the last paisa. You will be surprised at the amount of random purchases you make – from coffee breaks to grocery bills. These are the best places to start trimming.
  • Then, make a budget. This isn’t as difficult as you think. All a budget does is create a plan for spending, by stating expenses and goals. Make sure to cover fixed and regular expenses such as mortgage or rent, utility payments, and car or loan/credit card payments. Then set limits on necessities like groceries and clothing, as well as nice-to-haves like entertainment and travel. It’s also important at this stage to factor in a savings amount.
  • Now, your first priority is an emergency fund, if you don’t already have one in place. And the easiest way to do this is to have the amount deducted from your salary every month and put into a Fixed or Recurring Deposit. Give yourself a pat on the back if you find yourself adding that little extra to your fund because you managed to save a little more this month. You might find it easier to stay within budget if you use cash or debit cards for the necessities and frills.
  • As your emergency fund accumulates, your next task is to find more money for savings and even investment. Begin by paying off your credit cards. If you spend a little time examining your monthly statements, you will be amazed to see how much money you’re losing just by way of interest!


At this point, we need to address the differences between saving and investing.

Savings provide for emergencies and fund specific purchases in the near future (within two years). The primary goal is to store funds and keep them safe. However, you invest to increase net worth and work toward long-term goals. Also realise that investing involves risk, where you could lose some of your original investment. Only consider an investment plan when you have in place an emergency fund, insurance, control over credit use, and a retirement plan.


Now, consider making a long-range savings and investment plan. When beginning to plan for investments, consider your goals, the amount of time you will be able to spend on nurturing these investments, how much you know about the funds, how much money you have to invest, whether you can tolerate risk, and handle loss. Remember that your ultimate goal is a financially secure future for you and your family.

If you look back over all that we’ve discussed so far, you will realise that we’ve told you how to begin saving money, in small, manageable chunks. The final objective might be to set aside enough for you to retire so that you don’t have to work another day, but your immediate goal is to start the process and become habituated, so that saving becomes a way of life, and a chance to improve how you live.

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22 thoughts on “Start on a savings plan!

  1. Ahamed

    HI, this is good. Everyone could save money and get safe future.

    1. Chetan

      These savings are for people who believe in live and let others live .

      Sorry but these plans are not for MULLAHS.
      you dont get a risk in life cos you are born and brought up as suicide bombers.

      1. ram

        dear chetan…r u considering the people who demolished the babri masjid..becoz any premises demolishing without law consent is illegal n act of terrorism so u don't only consider mullah's that will be true patriotic person i believe.

  2. S.Udayabhanu

    It's like every one's mthod to save. But nothing new to save since it's fundamental to saving for the future.

    Everyone says investing in FD is not up to mark compared to investing in stocks. but stocks needs more knowledge and understanding.

    What ever has been told here is just for the starters and nothing new.

    However i apprciate the article.

    1. Sathappan

      Very nice and thanks for your valuable advice


  3. Tuwaram Dutta

    save like ant for better future. So far as spending is concern "buy an elephant if necessary or donot buy a small needle too,if it is unnecessary.

  4. Bhabesh Banerjee

    It is a good reminder to often said but seldom practiced philosophy.If it would have been within my capabilities as an old father,I would have forced it down the throats of my very good and supporting children,to tighten their belts from this moment itself.However,thank you for making efforts,I pray for all earning and spending children of ours to be very careful about spending before the house gets on fire.

  5. Lloyd

    Chetan I think you are an ass…It is complete in human of you to post such comnets and show of your up bringing

  6. Madhav

    Chetan please dont post something like this which is against the humanitary level…..

  7. Disha

    What has this article to do with Religions????

    Sickness has creeped into some people's mindset. For God sake, leave this hatred

  8. sanjoy

    this article has nothing to do with religious sects, chetan keep your violent emotions within yourself, nobody wants that!

  9. Vikas Gupta

    I think the focus here should be solely on saving for a start. Once one has achieved that for at least 1 year, and depending on the amount saved, other investment options can be explored to let your savings start earning as well. It is a good article as it is very basic and in essence true to the core. Once again, one should not be mixing up Saving and Investing. These are two different things.

    1. Lachar-Ashaya-Nagrik

      If we are getting not more income? what I do
      every could not do saving if income is very very poor ……

  10. jaya sharan

    chetan's comments are completely out of context here……….

  11. Smita Vaity

    this post is really good to make people aware that savings is really important…many earn a good and handsome amount through hard work, but we the young generation do spend as if there is no tomorrow…savings is required as money is too important to meet out any kind of emergency need and for future betterment of our kids…also if savings become our habit, we do not have to spread our hands in front of others in need.

  12. Tinda

    Hi All, . . it sounds simple and good for starters . . will help young earning or freshers to start savings .. if i would hv came accross such article 6 year back .. would have saved more 🙂 . .

  13. Bhanu Prakash

    The artilce is good. However, I'd appreciate if it'd contain the possible ways of making effective savings. For beginners like me, it'd be very helpful to know some expertise advice on saving and moreover the comments on this will be of great value.

    Sorry if made any mistakes.


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