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What saving Rs 1000 a month is worth?

Rs 1000 today can be put to use in many different ways, but let’s see what kind of value it adds to your life if you were to look back a decade later.

The colour of money is the same no matter what you do with it. What this means is that the same Rs 1000 can be used for multiple purposes and its value doesn’t change. It’s up to you to assign the value it carries to the basket of your choice. You can choose to spend, save, invest or gift. 

Rs 1000 today can be put to use in many different ways, but let’s see what kind of value it adds to your life if you were to look back a decade later. 

1. Spending – A thousand rupees can buy you many things:

a. A week’s supply of vegetables and some fruits for a family of 4. Future value – health.

b. Two tops/t-shirts on discount on an e-commerce site. Future value – Nil.

c. Two Rs 500 pre-paid mobile recharge which can last up to 6 months. Future value – immeasurable if used for work; Nil if used to chat and download mindless videos. 

d. Four packets of Classic Milds cigarettes. Future value – ill health and disease.

e. Three cups of Starbucks Coffee. Future value – likely obesity and addiction to coffee.

f. Two avocados for salad. Future Value – good health.

g. One pair of flip flops. Future Value – Nil.

h. One pair of ear phones. Future Value – Nil.

i. Three fiction/nonfiction novels. Future value – better imagination, language and life skills. 

j. One month’s Netflix and one year’s Amazon Prime subscription. Future value – vague. 

 

Rs 1000 invested in a short-term debt fund for 12 months, amounts to Rs 12,000. Future value – in 10 years, worth Rs 27, 368
 

2. Saving and Investing – These two have been clubbed together because while saving is the act of not spending the money, for it to be useful, one has to invest.

a. Left in your cupboard each month for 12 months, amounts to Rs 12,000. Future value – thanks to inflation worth Rs 6780 after 10 years

b. Left in the bank each month for 12 months, amounts to Rs 12,000. Future value – in 10 years, worth Rs 17,247.

c. Left in the bank each month for 10 months and then shifted to a fixed deposit for 10 years. Future value – in 10 years, worth Rs 18,833

d. Invested in a liquid fund for 12 months, amounts to Rs 12,000. Future value – in 10 years, worth Rs 22,916

e. Invested in a short-term debt fund for 12 months, amounts to Rs 12,000. Future value – in 10 years, worth Rs 27, 368

f. Invested in diversified equity fund for 12 months, amounts to Rs 12,000. Future value – in 10 years, worth Rs 28,126

g. Invested in PPF after 12 months of saving, amounts to Rs 12,000. Future value – in 10 years, worth Rs 23,868

h. Invested in gold after 12 months of saving, amounts to Rs 12,000. Future value –in 10 years, worth Rs 24,068

i. Invested in property after 12 months of saving, amounts to Rs 12,000. Future value – unlikely to have bought property with Rs 12,000!

 

3. Gifting – This is one aspect of money which can give you immense satisfaction. You can indulge in gifting more successfully if you have been able to build some savings

a. Gift 1 mid-day meal for 400-500 needy children; save Rs 1000 a month for 4 months. Future value – immeasurable.

b. Gift education to a needy child, Rs 1000-1250 a month. Future value – countless blessings.

c. Gift stationery to needy children, Rs 1000-1500 a month. Future value – innumerable smiles.

d. Gift your niece/nephew/house help’s child or neighbour’s child, an age appropriate book, Future value – self-satisfaction of sharing knowledge.

e. Gift a blanket to a homeless person. Future value – infinite. 

f. Gift biscuits to stray puppies. Future value – joy of sharing.

g. Gift a plant to your mother. Future value – too many hugs to handle!

You get the point. The value of gifting is unaccountable, but it's best undertaken when you have savings to spare. 

What you do with your money is left up to you. Balancing the future value and immediate gratification is what’s most important; learn to use your money to enhance future value rather than for something you will forget quickly.

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