Personal finance typically starts with the budget. You look at your income and expenses and try to figure out how you can improve your savings.

There are only two ways your savings can increase: either you can increase your income and save a chunk of the increase, or you can cut your spending and use the available money to save. Both need to be pursued but cutting spending tends to be more low hanging fruit – you can easily identify wasteful spending habits and cut them out so that you can save more money.

Typically, cutting down on expenses that occur regularly can really free up your cash flows. One-time expenses can be planned for in advance or can be dealt with based on the situation. But it is those regular debits that are hitting your accounts that are the ones can really impact your cash flow over time. 

A Netflix subscription can cost anywhere between Rs. 199 to Rs. 799 per month. Did you know that you can do an SIP for as low as Rs. 500 per month. Now think about it – if you spend 799 per month on Netflix, that is money that is gone – but with an SIP you are saving for the future and the money will build on itself. Now very few people will make that choice – after all the Netflix subscription will deliver some value to them that’s worth paying for! 

But there are many other regular purchases that you may be paying for that might not be worth the money. You may get value out of 2 or maybe 3 video platform subscriptions – but beyond that how much do you really need? And it doesn’t even have to be a subscription – it could just be a purchase you make frequently. Order food for delivery a couple of times a week? Those bills can add up fast.

Cutting down those regular purchases can really help you free up cash flows and increase your savings over time – which is one of the key pillars of wealth creation.