Tell me who does not love shopping? Shopping is everyone's favorite and the disease of over shopping is raging across India. While some people are addicted to shopping and just can't stop buying things, other people buy things just to show off and grab attention. Now, online shopping has also influenced people's purchasing behavior. According to the report, in the year 2017, as many as 108 million consumers indulged in online shopping and in the year 2018, over 120 million consumers are expected to shop online. With huge offers and discounts, online shopping portals encourage people to shop more.
If you are the kind of person who splurges on shopping, you need to plan finances well. Splurging money occasionally is fine, but doing so all the time will affect finances. This might put you in a lot of problem in the future. In this blog, we will discuss the top 8 personal finance tips for people who splurge.
Never borrow more than you can repay. There are some people who pay using a credit card for almost all purchases, but when it comes to paying the credit card dues, they end up paying the minimum amount due. Doing so can land you in a debt trap as interest charged on credit card is as high as 2-3% a month. So, you should spend using your credit card only if you are confident that you can repay the entire balance within the due date.
You should have the habit of saving and investing for the long-term. Investing has the power to grow your money over a long period of time. For instance, if you invest Rs 2,000 a month in equity funds via SIPs, you will get around Rs 15 Lakhs in the next 20 years.
The money saved in the EPF and PPF account will help you lead a happy retired life. You should never touch funds saved in these accounts before retirement.
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If your family is dependent, it is very important to avail term life insurance. Term life insurance ensures that your family is financially stable even without your presence. You should avail term life insurance at a young age, as premiums charged are low and provide decent cover.
It is a known fact; medical expenses are rising each day. Not having a health insurance plan can burn a hole in your pocket, in case of a medical emergency. So, it is advisable to avail health insurance for both you and family. Don't simply rely on the health cover provided by employer, as in case you lose the job, you are left uninsured.
Repay loans with high interest as soon as possible. In case you take too long to repay the loan, you will end up paying high interest.
I am sure you get a salary hike each year. As your salary is hiked, increase the amount of investment, instead of using all of it for your own consumption.
Instead of spending money on unnecessary things which require high maintenance, create assets that help in the future.