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Zero balance account for your splurges

Saving for emergencies in a savings account (or a zero balance account) is an important part of a financial plan. It is important because we never know when will emergencies crop up. These emergencies can include a job loss, car break down etc.

While many articles and blogs will help you to save for these emergencies, not many focus on having an emergency fund for splurges.

We are not saying that you should focus solely on saving for your splurges, but splurges such as visiting a concert or a game are rarely talked about. It is important because all these things make our lives enjoyable. And many of such situations are once in a lifetime opportunities. Also, everything has a timeline. When you hit your 30s or 40s, it is more likely that sleep and time with our family members will be a priority rather than going out with friends to a concert where there are hundreds of people. Hence, a few things are best enjoyed at a certain age.  

A ticket can easily cost Rs.5,000. And along with other expenses, the cost of the overall trip can run into Rs 15,000 or more.

Have you always dreamt about going to a concert, music festival like Sula or Sunburn festival but never had any money to pursue it?

Zero balance for splurges

Well, this is going to change now as we give you step by step ways that can help you plan for these events without comprising on your other financial goals.

Start with the Why

Knowing the why behind any action is a good thing. And the same principle applies when we are saving money for concerts, music festivals or a match.  Knowing the why will make sure that you are on the right path.

Are you going to repent not seeing your favourite band perform live when you could? Are you doing these to appear ‘cool’? If the reasons are genuine, then you are almost halfway through.

Know Much You Can Save

We get that saving for a concert when you are paying rent, buying groceries and saving for your other financial goals, can be tough. One way to start could be to figure out how much you can spend. It can be Rs.500 or Rs.1,000. It all depends on you. You should keep in mind that it should not hamper your overall finances.

Calculate your fixed expenses such as rent, food, transportation cost, existing Systematic investment plans or recurring deposits. Figure how much you can save per month after taking out all these expenses and investments.

Cut your expenses

One of the easiest (not so easy as well) ways is to cut your expenses. Are you going out random shopping every other weekend? Or do you find yourself ordering food now and then because of something that is going on in your head?

 If you don’t have the kind of money that you want to save, look at the areas where you can cut back. Stop spending on areas that do not give you a lot of joy but you spend it anyway. Cut those expenses and you will be surprised how much you can save.  

Open a digital zero balance account

Now that you have figured out how much you can save, and how you can save more, the next step would be deciding where to save the money. In this respect, it is important to keep in it in a separate account exclusively for these purposes. You can open a digital zero balance account for the same. It is easy to open a digital account and it hardly takes a few minutes. All you need is the PAN card and Aadhaar card. With a zero balance account, you won’t need to keep a minimum average balance. That means that you can withdraw the entire amount from your account without fearing any penalty. So Yay!

All you have to do is transfer the amount of money every month from your salary account to the zero balance account via internet banking. And you are sorted.

Next time there is a festival of your choice, you can easily book tickets and take care of the other associated expenses without getting broke.


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