IILM College of Engineering and Technology

Earn More, Save More and Spend More

What every individual needs to learn about money management

Earn More, Save More and Spend More” is a simple three step process to be followed in order. The order is very important here. First earn, then save and then spend whatever is left. And if you really want to spend more then you need to earn more. The savings, then, must be translated into meaningful investments. Investments are the route to a richer life. All one need to do is to keep some basic things in mind:

1. Set Your Goals:  Goals are the statements about where you want to end up. They are what you want to achieve. The Goals should be SMART- Specific, Measureable, Achievable, Realistic and Time Bound.

2. Understand Your Risk Tolerance: Risk tolerance is a psychological trait that is genetically based, but positively influenced by education, income, and wealth (as these increase, risk tolerance appears to increase slightly) and negatively by age (as one gets older, risk tolerance decreases). Your risk tolerance is how you feel about risk and the degree of anxiety you feel when risk is present.

3. Handle Basics First: Financial news and information can be intimidating. You can choose not to be scared if you look out for right resources such as financial blogs or online portals that explain jargons and concepts in a simple way. One should read up one jargon or financial term a day.

4. Choose the right way to Invest: Invest through an intermediary like a bank or a financial advisor. The thumb rule here is to understand the interest of the company or person giving advice, whether, is it in your interest or its own best interest. An intermediary can do the necessary paperwork as well as advice on where to invest.

5. Choosing the right investment: Based on the set goals, there are three cardinal rules of choosing an investment avenue- (1) Returns, (2) the time period of investing and (3) Tax Efficiency. Whatever your financial goal – higher education expenses or simply creating wealth for yourself in long-term- you don’t need complex investment products. Investing to create wealth means you invest regularly in an avenue that grows your money over a period of time. Investing to meet a short-term goal means you invest in an avenue that offers safety of your principal.


Blog by: Dr. Shikha Mittal Shrivastav, Assistant Professor, Dept. Of Management, IILM CET, Greater Noida


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