Before going to bed one-night last month, I got a text message: “You have spent Rs 459 via debit card at Amazon.” I read the message and slept. Later, in the morning, when I woke up I read the message again and wondered why Rs 459 was charged to my debit card. I then checked the Amazon app and realised I forgot to turn off auto-renewal. Rs 459 is not a huge sum but it pinched me a lot when the money was deducted from my account for a service I no longer use. That day I realised I need to seriously understand my monthly expenses better, especially the amount spent on services and apps. I am not trying to be a personal finance expert but I want to share my experience and a few tips you can apply to better manage your tech budget.
Understand where your money is going
Whether you are a student or a working professional, start paying attention to the basic fundamental components of financial literacy. Nobody will tell you what is more important: a coffee at a cafe or paying the EMI of your smartphone before the due date? The point is to understand the benefits of financial literacy so that you know where your money is going. Every penny matters. Until a few months back, I was randomly purchasing vintage gadgets on OLX and because of that, I messed up my finances. I still buy vintage gadgets but now I look at my bank balance and review my spending before buying anything new.
Look for a bundled plan
Instead of subscribing to individual services, opt for a bundle that brings a lot of services under one umbrella. I don’t know if you have heard about Apple One, it’s a services bundle that brings together Apple’s premium services offerings, such as Apple Music and Apple Arcade, at a discount. I recently subscribed to the Apple One Individual Plan, where I got access to Apple Music, Apple TV Plus, Apple Arcade, and 50GB of iCloud Storage, all for Rs 195 a month. Previously, I was paying individually for Apple Music and Apple Arcade, and both services cost more than Rs 200 a month. Another reason to choose the Apple One bundle is Severance on Apple TV Plus, a show I am currently hooked to.
Hot tip: Make sure you are aware of the mobile data plans that come with free access to popular streaming services. Reliance Jio, Airtel and Vi (previously Vodafone) have prepaid and postpaid plans with a free subscription to streaming services.
Dedicate a monthly budget
This is probably the biggest lesson I learned about money in the past decade. Not only does budgeting help you reach your financial goals if you stick to it, but documenting every expense incurred in a month is a smarter move in the long run. Here’s how to do it.
A fixed sum for streaming services: Commit a budget that you need to spend on streaming and subscription services. A simple way to divide it is by using the 50/20/30 rule of budgeting. Essentially, you are breaking your income into three parts: 50% of your income goes to basic needs (house rent, groceries, etc), 20% goes to savings (and debt repayment), and 30% is to spend on personal use (eating out, streaming services, etc). If it works, a monthly budget will give a lot of flexibility. In my case, I have figured out which services I want to use and based on that I am dedicating a monthly budget. For me, the biggest challenge is to get into the habit of knowing how much I have to spend each month.
Track where your money goes: Write it down on paper, maintain a spreadsheet or use budgeting apps, and note down every expense you have for a month. The ability to make better financial decisions is what you need to learn and that too quickly.
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