All of us want to get rich but while some of us fall behind on our financial savings goals due to poor planning, some others fail to capitalize on the easy wins. The real art is to generate savings even if your income level remains almost constant. In the following sections, we will discuss some of the ways you can maximize your savings to get closer to your financial goals with minimum effort.
- Save Big with Home Loan Balance Transfer
If you are currently repaying a home loan, then another great option to save money is to opt for home loan balance transfer. You stand to save big through such a transfer as home loans feature some of the longest tenures as well as the highest amounts. In case of such loans, even a 1% decrease in the interest rate by making a home loan balance transfer can lead to substantial savings. However, make sure that you do not pick a new lender who jacks up your home loan rate after the introductory period ends. Using a home loan balance transfer calculator can help you gauge the extent of your savings.
- Credit Card Balance Transfer to the Rescue
This is one of the best ways to decrease your interest and EMI outflows. One way you can save big is through a credit card balance transfer. Credit card balances are the most expensive form of debt that you can have with annual interest rates that can be as high as 45%. This process involves the transfer of the outstanding balance on a credit card with a higher interest rate to a credit card which features a lower interest rate. Sometimes you may also receive a special offer with an interest free period, however, make sure that you read the balance transfer agreement. This is to ensure that you will not end up paying an astronomical amount after your interest-free period ends.
- Liquidate and Reinvest Underperforming Investments
Once a year take out some time to check on the performance of your investments. It is possible that some of your investments may not be yielding the returns as you had expected. In such cases, consider liquidating those investments and using those funds to make other investments that can potentially help you get better returns. [Also read: 7 Steps to a Personal Financial Budget]
- Get a Second Opinion before Filing Your Taxes
This might be a long shot. However, if you are the type of person who files their own taxes, getting a second opinion is definitely a good idea. It is not impossible that you might have missed some tax saving expense and this second opinion can be well worth the additional effort. It is even recommended that you get a second opinion in case you get your tax returns filed professionally as there is always the possibility of human error.
- Say Goodbye to Credit Report Errors
Your credit report is a document that contains your entire financial history including any current or previous credit cards or loans that you have availed. For lending institutions, you credit report and one of its key components, the credit score play a key role in determining if your loan application will be approved or rejected. Sometimes, there may be errors in your credit report, such as mismatching addresses, old loans/credit cards that were settled by you but are still showing up on the report as defaults, etc.
At the very least, such errors can cause delays in processing loan/credit card applications or may lead to higher interest rates on loans provided to you. You should therefore ideally check your credit report at least once a year and especially before applying for a new loan or a credit card to ensure there are no errors. This would allow you to save big in the long term.