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One more reason why you should automate savings first

What remains a constant is that faced with an increasing shortage of time we are spending more and more on convenience simply because it is easier.

Bengaluru residents swear by their apps. Whether it’s ordering food, cabs or even that file you forgot at home, but you need at work. You can literally order it all and it’s just a swipe away. A friend recently wrote on his blog about our increasing dependence on apps. He argued that we all might be in danger of becoming slaves of convenience.

That’s a fair point and this does have an impact on our financial health, as he argued. Many of us, thanks to our jobs, live in metros. This comes with its own set of unique challenges that change with the city we reside in.

Mumbaikars rely on public transport in the form of local trains whereas residents in Bengaluru might use Uber or Ola more. This implies that where our money goes changes with the city

Changing times, changing spends

Whether you like it or not you will end up spending in ways you haven’t even envisaged yet. Five years ago, food delivery was not as ubiquitous. Getting a cab was a relatively big deal. Today they are fast becoming the default choice and thus “necessary” rather than optional expenses.

What remains a constant is that faced with an increasing shortage of time we are spending more and more on convenience simply because it is easier.

Add to this all the cash back deals and marketing gimmicks used to attract more app users, making it almost too hard to resist, until and unless you simply don’t have the spare cash to spend.

The answer is the age old but incredibly practical adage – “Save before you spend”. If spending has become, “just a swipe away”, then so has saving and investing.

Automated spending demands automated saving

If spending will increasingly move towards “automatic” paths, then how do we save?

The answer is the age old but incredibly practical adage – “Save before you spend”. If spending has become, “just a swipe away”, then so has saving and investing.

What’s a good thing to do?

As soon as you get your salary, sit down the very next day and think about your financial goals. Take some time to think about this seriously, with a nice cup of tea or coffee. If you don’t have any idea what a goal can be, then read this.

Then simply invest in what is right for that goal, which can be equity or fixed income. If nothing else, put a bit away in a liquid fund which is one of the most stable yet tax efficient kind of mutual funds that invests in fixed income and is comparable to a fixed deposit in terms of performance.  This can be your emergency fund.

The point is this; doing something small is better than just letting your money sit in the account waiting for a “convenient” app to swipe it away.

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