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saving money when you're unemployed may not be easy, but it is an essential practice to ensure financial stability and security. Inculcate these strategies to create a sustainable savings plan.
Finding yourself unemployed can be a challenging time, but it's important to remember that saving money is not just something you should do when you're employed and earning a steady income. In fact, it's a good habit to develop even when you're facing unemployment.
Initially, you might have some questions in your mind like: what can I do? How? Where? How much money can I make?
You can earn money through your daily savings. There are daily savings apps available, where you can start saving and managing your money.
Many options are available on these apps. These apps are best for someone who is looking for simple ways to make money.
You can automate your daily savings with these apps. They can easily be accessed by a smartphone with some simple and easy features.
During the pandemic, when people lost their jobs and had no source to earn money, they started using apps such as Daily Savings App and Digital Gold Investment App to grow their money online.
If you are unemployed and have no source of income right now, you should invest your money wisely for some returns.
Many people save their money in a bank account with a few investments. Though these investments earn interest, the returns are far insufficient to offset the effects of inflation in the long run.
Most of the banks offer a return of 4% (sometimes, even less!) on savings accounts. So, don't let your money sit idle; make it work for you.
It is crucial to keep an eye out for other better choices and investment opportunities.
The automated savings app tracks every transaction that occurs in and out of your bank account, and it periodically transfers money from checking to savings in amounts that are determined safe and secure with its algorithms.
Investing is a crucial component of wealth creation. It aids in reducing inflation, achieving financial objectives and stabilising the financial future. You have the option to invest in a variety of things, including stocks, equities, mutual funds and fixed deposits, rather than letting your money sit in your bank accounts with minimum interest rates and profit.
Investing is one of the best options to reach your financial goals and create a financial cushion for the future so that you can live a secure life.
In contrast to other asset classes, there are some investment plans available on the market that are highly risky but have the potential to produce favourable long-term returns.
Choosing the best investment plan, however, could be a difficult task without proper financial literacy.
But money-saving apps are the best options to grow your savings effectively without any risk of capital loss. Apart from these apps, a few financial strategies that can boost your savings are listed below:
Stocks
Stocks signify a portion of ownership in a business or other commodity.
It is one of the finest ways for long-term investors to generate sizable profits.
However, as these instruments are market-linked, there is always a chance of suffering a capital loss.
Real estate
One of the fastest-growing industries in India, real estate has promising futures.
One of the most effective investment alternatives in India is purchasing an apartment or a plot of land.
Real estate is a low-risk investment that generates large profits over the long term because the property rate is expected to rise every six months.
Fixed deposit
For risk-averse investors, a fixed deposit is the perfect investment option.
A fixed deposit offers guaranteed returns on your money while being unaffected by market fluctuations.
Even high-risk investors opt to stabilise their portfolios by investing in fixed deposits.
REITs
Companies that hold or finance income-producing real estate across a variety of property industries are known as real estate investment trusts (REITs).
To be eligible to become REITs, these real estate firms must fulfil several standards.
Most REITs trade on significant stock exchanges, providing investors with several advantages.
Cryptocurrencies
It is a type of money that exists virtually or digitally, it uses encryption to safeguard transactions.
Cryptocurrencies employ a decentralised mechanism to track transactions and create new units rather than a central authority to issue or regulate them.
Mutual funds
Mutual funds are investments run by fund managers that combine investor capital and make investments in the stocks and bonds of various firms to generate returns.
Even when starting with a lesser initial payment, you can still generate sizable profits.
Public provident fund
PPF is a reputable investment strategy.
The principal invested, maturity amount and interest received are all tax-exempt, and investments can be made starting at Rs. 500 each year. It has a 15-year lock-in term, with a few exemptions where partial withdrawals are permitted.
NPS
NPS is a profitable government-backed investment option that offers pension alternatives.
Bonds, government securities, equities and other investment alternatives are purchased with your money and the programme doesn't mature until the investor is 60 years old. The length of the lock-in period depends on their age.
Gold bonds
Sovereign Gold Bonds are issued by the RBI in place of the purchase of physical gold.
Instead of owning physical gold, the Reserve Bank issues the bond on behalf of the Government of India.
Investors must pay the issue price in cash, and at maturity, bonds may be redeemed in cash.
Where to invest your money
You can invest your money either in market-linked instruments or those that are unaffected by market changes, depending on your risk and tolerance.
Market-linked investments offer higher returns, but because they carry a risk of capital loss, they aren't always the best investment strategies. In contrast, investment instruments like fixed deposits provide a greater variety of funds.
Money-saving apps are the best option to save money because they keep track of your spending and integrate your bank accounts to get a complete picture and analyse your spending patterns and offer helpful advice on how to save more money and where to make cuts.
