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10 tips to make your salary last beyond the end of the month

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10 tips to make your salary last beyond the end of the month

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Whether you earn ₹10,000 per month or ₹1 lakh, one thing everyone needs to know is how to save money from your salary every month. If you have trouble saving money, or if you want to save more each month, it helps if you have an action plan or a checklist of sorts. You also need to cultivate healthy financial habits that will make it easier to save rather than spend most of your salary. 

Here are 10 tips on how to save money from your salary every month.

1. Budget. Budget. Budget.

Budgeting is the first rule of learning how to save money. To draw up a budget, you simply need to record all your income and note down all your expenses. This will give you a better idea of how much you can afford to save up each month. Instead of manually tracking your money, you can use Ask.Fi’s AI-powered analytics to automate your expenditure tracking and get deep insights into your finances.

2. Cut down some expenses 

Once you have prepared a budget, you will have a clear idea of what you typically spend on. Expenses like food, rent and groceries cannot be eliminated or reduced. But you can definitely cut out or cut down on expenses like unused subscriptions, impulse buys and ordering food regularly. The money that you save in these areas can be redirected to your savings and investments.

3. Borrow wisely 

It may not be possible to eliminate debt entirely. You may have to borrow funds for various reasons. That said, some debts are better than others. For instance, home loans and education loans help you achieve certain life goals that add to your income and assets. But debt like credit cards can quickly spiral out of control if you don’t pay attention. 

4. Save with a purpose

If you don’t know what you are saving for, you may not have the incentive to save diligently. This is why clear goals are important. Have specific targets in mind and draw up a plan to save up for each of them. This will also make it easier to track your progress. Knowing you are getting closer to the goal will encourage you to save more each month. You can create ‘Jars’ for goals like a new iPhone or a Goa trip on the Fi app. 

5. Put your bonuses to good use

You might be fortunate enough receive bonuses and incentives. It can be tempting to spend this money impulsively on a premium purchase like a gadget or a vacation. But you could help your future self out and save at least a part of these bonuses instead of spending it all. 

6. Automate your savings

If you are having a tough time saving up as per your plan each month, you can make use of money management apps to automate your savings. FIT Rules on the Fi app do exactly with the added flexibility to channel your savings towards different goals. For example, you can set up a FIT rule like ‘Put aside ₹1000 on the 5th of ever  month in iPhone Jar’. 

7. Make use of apps to save better

Today, there are many apps that can also make saving easier and less challenging for you. Some apps send in timely reminders for you to save money as per your set timeline, others help you track your progress. Some even reward you for meeting your saving goals. All these features can make it more interesting and incentivising to save some money rather than spend it all.

8. Limit the liquidity of your funds

If all of your salary is easily accessible, you will find that it is easier to spend your money long before the month is up. So, try to make your income less liquid or more inaccessible. For instance, you could save up most of the money in an account that is not linked to any debit card or UPI account. You can also automate a fund transfer towards a smart deposit or mutual fund when you get your salary on the Fi app.  

9. Make your savings more rewarding

Typically, when you save money as cash, you don’t really earn anything in the process. Cash sitting idle at home doesn’t grow, and it’s only easier to spend. On the other hand, if you transfer your savings into a deposit or mutual funds, you can earn a decent amount of interest on the sum. 

10. Treat yourself (with caution)

Lastly, this may seem counterintuitive to saving money, but it is necessary to treat yourself occasionally. By indulging yourself occasionally, you can ensure that your impulses are satisfied. This will save you the trouble of indulging in a ‘cheat spend,’ which could turn out to be bigger than your finances can handle. So, if you have a sizable sum left over as savings, set aside a small portion of your salary for yourself and your wants.

You may not be able to follow all of these tips right away, at one go. However, try to integrate these habits into your everyday financial routine. This will gradually make it easier for you to cultivate the habit of saving up a significant portion of your income on a monthly basis. 

Frequently Asked Questions

1. How much money should I save from my salary?

That depends entirely on your financial situation and your financial goals. You can save as little as 10% of your salary or as much as 90% of the income. That said, it is always advisable to save at least some of your salary and not spend the entire amount. This way, you can save for a rainy day and also achieve your financial goals sooner than later. 

2. How do I manage a ₹20,000 Salary?

To manage a ₹20,000 salary, you need to follow a budgeting rule. There are many guidelines that can help you here, like the 50-20-30 rule or the save-then-spend rule. Whichever rule you follow, make sure that you limit spending on wants and discretionary expenses. 

Curious? Read more!

1. How to negotiate your salary or appraisal like a pro

2. Planning to invest with your first salary? Here’s why you should opt for Mutual Funds

3. Your take home salary break up using memes

4. Salary Structure : Components and how to calculate your salary

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