You want to save money?

“Tell me, Sir, how can I save money from my small salary? I want to save but find it very difficult,” Anand asked Kalidas.

Anand was a bachelor, just a couple of years into his first job.

He considered Kalidas as his mentor. He and his friends gathered together to meet Kalidas and seek his guidance on financial matters.

All were younger than 30 years, except of course, Kalidas who was 48. Kalidas was a multimillionaire with stakes in several businesses.

Naturally, Anand’s question of how to save money interested every one and they all looked at their financial guru, mentor, and adviser. Kalidas was a busy man whose time was precious and so he had asked the group to gather at the roadside tea-stall nearest to his house.

Looking at Kalidas in his cotton pants and white shirt, sipping masala chai by the roadside, no one would believe he was wealthy. A simple man with a simple lifestyle. Uncomplicated. Living in the same house for years and having a single car that was now more than 5 years old.

“There are many ways,” Kalidas said. “For example, I used to keep aside the five-rupee coins that I came across in my daily transactions. Later, I upgraded to keeping aside twenty-rupee notes, when my finances improved. Of course, all this was many years back.”

Many in the group were in shock and awe that their mentor started his financial journey from a situation worse than theirs.

They listened in rapt silence as Kalidas continued, “Putting coins in a piggy bank might not give you a fortune but it strengthens your focus on saving and investing. Habits are powerful. Make saving money a habit. Most important habit I would recommend is to set aside minimum 10% of your take-home salary as savings before you do anything else.”

 “Many employees in my companies do this,” Kalidas said. “They expect some amount as their annual bonus and if the bonus is more, they save the ‘extra’ amount.”

 “Here is one other trick. Whenever you are buying things that involve bargaining, at times you succeed in getting much lower prices than expected. Put the difference into your savings account. It’s a small but effective way to save.”

“I think we understand the concept of what you are saying,” Anand said. “Saving small amounts regularly can become a habit. We just need to be creative about it.”

Vivek, one of the regulars in the group, added, “This reminds me of what my mother does regularly. Whenever she buys things and the bill total is a certain amount, she would round up the total to the nearest multiple of 10 and save the difference.

Like if the bill was Rs. 284, she’d record it as Rs. 290 and save the Rs. 6.”

Kalidas smiled, “Yes, that is a good trick to save some money. In fact, ask your mothers, grandmothers, or other elders, you might get to know more such tricks. Alright, let’s call it a day. See you all next time!”