My Personal Experiences and Perspectives
Based on my experience, some data points and insights are summarised below.
Financial and Family Background.
Salaried. Married.
Financial Set-up.
I track my expenses manually in a diary, on a daily basis and jot down all the daily expenses. These include rent, grocery, movies, dining, travel, domestic help, fuel etc. Most of these expenses are aggregated in the credit card statements, so I use the aggregates from there to plan for the next month and to tally expenses with the current month. Broadly allocate money for the next month and then stick to it. Keep some dough as reserve for unforeseen situations. I also use Excel sheet with columns as per my requirement and fill it monthly and then annually. Thus, I keep track of my weekly, monthly and annual expenses.
Managing Expenses.
Earlier believed in only debit card/cash. With corona, adapted to UPI. Then, since last year - have graduated to credit cards - up to 50-60% of my total annual expenses. Balance is a mix of cash and UPI.
Savings.
I generally save up to 50-60% of my total income easily. This has been a constant average rate over the last many years. Since I do manual budget tracking, so can focus on weeding out any extra expenditure. Plan my big-ticket expenses - which have now dwindled down to far and few. Also have a PPF account (for a 15-year long term view), a few FDs (for a mid-term view) and some cash for routine expenses.
Cash Flow.
Apart from my monthly salary, also have monthly FD returns, rental income. So adequate cash flow is maintained.
Credit Card Usage.
Use my credit cards as debit cards to maintain cash flow. The bill generation dates are on 1st/2nd of each month- so the statement cycles overlap with the months, thus keeping my tracking of rewards and expenses aligned to my monthly budgets. Have adequate limit in all cards to meet my expenses.
Investment.
Plan my investments based on the upheavals in the market and deploy as and when I spot an opportunity. Invest in direct equity - never in mutual funds. Have adequate diversification. Based on the market, have booked profits as and when deemed fit - both short term as well as long term capital gains.
Insurance.
Have adequate health + life + house + vehicle insurance.
Income Tax.
I get my salary after TDS. For rental income + FD interest + capital gains, I pay my advance tax, generally towards the end of the FY (between January - March). I plan for it accordingly. Fill the ITR by mid-July after making any adjustments/refunds/additional tax. Generally, work out the advance tax manually to get a firsthand picture of my tax liabilities based on my income. And then discuss with a tax consultant for minor fees. Then fill up the ITR after confirmation and understanding the nuances. Helps me in managing and planning my finances better.
Loans.
Finished off my loans - home loan as well as car loan - some time back. So, no debt as of now.
Apps.
No apps. I prefer manual system - jotting down my cash flows and expenses on occurrence. It is an old habit from my childhood. Has served me well. Gives my time to refine my budget as well as plan ahead as I put my thoughts to paper by pen in my own hands. I am comfortable with it. I also use Excel sheets for summarising my monthly and annual expenses etc. to decipher some patterns which I may have missed.
Time Spent.
I generally spend about 10-15 minutes per week - about 1 hour per month on planning and jotting down my cash flows and expenses.
Hope this helps.
🙂
