Let's be honest, saving money can be quite challenging, especially when you're just starting out in your career. Do you remember those Gullaks we used to have as kids? Often, we'd barely collect any money before eagerly cracking them open. It's a lesson of patience, highlighting the effort it takes to save money. Thankfully, today we have a variety of options available, such as stocks, mutual funds (MFs), fixed deposits (FDs), and more.

This blog explores four tips to help you accelerate your savings and maximize your returns.

1.   When You Earn More and Save More

One of the ways you can save money faster is by earning more. But how to earn more? There are two ways to do so. Firstly, you can focus on what you are doing, like a job, and try to get a raise in your salary. So, the raise that you have got, you can contribute it directly to your savings. The second way, however, is to do a side hustle. With this option, you have to be very careful. The reason is that you need to take care of two deadlines with a side hustle. Thus, time management is the key to this option.

2.   Clear Debts Early

Another way to increase your savings is to get rid of debts. Now, while it's true that you can only get rid of a debt after paying all its EMIs, you should consider paying it off early. You can do it by starting to pay extra money that will be deducted from your principal amount. So, ultimately, you'll save a significant amount of interest.

3.   Get a Portfolio Touching All the Corners

Making the most out of your savings is not only about earning interest on it. Instead of earning interest, you also need to manage the risk. If you put all your money in a single investment instrument, you may lose much of your savings in case of a sudden market change. However, suppose you diversify your portfolio among multiple investments, especially by choosing low- or negatively correlated investments. In that case, it will help you manage risk better by acting like a self-balancing portfolio. Moreover, if you think that putting all your money in a single low-risk investment is better, then you'll miss the high returns that come with medium to high risk. So, a self-balancing portfolio is better than a low or high-risk portfolio in the long run.

4.   Make Returns on Your Emergency Fund

See, the liquidity of an emergency fund is utmost important. That's why making good returns on it is barely possible. The reason is that you can either keep it in a locker in your house where you'll make nothing extra or in a regular savings of account where you'll get minor returns. However, the current scenario for an emergency fund has changed. Instead of keeping your money in a savings account, you can opt for a flexible fixed deposit. What's it?

It's a new type of FD offered by many banks. What it does is that it allows you to pull your money out at any time. There is a lock-in period, but you can still debit your cash for emergencies. Hence, the profit is that you can keep your emergency fund liquid while earning more interest than a usual savings account.

The Savings Stat: Why Every Penny worths

Here are some stats that will tell you why savings is important for your future:

●      In 2020-21, Indians were saving 11.5% of our country's GDP. But  in 2022-23, the savings dropped to 5.1%.

●      It means it's hard to save now, and maximizing your savings is important.

●      The current inflation rate in India is around 5.5%, so you must maximize your savings to beat it.