1. First things first - Create a budget.



Youcan make better decisions if you know where your money is going. Thiswould help you save money quite easily. At the beginning of everymonth, draw up a budget taking all your expenses into account. Takecharge of your finances by determining your expenses and deciding whereyour income should go. After listing out all your regular expenses, youcan set aside some money for entertainment and eating out. And alwaysstash away some money for emergencies. Overall, keep your livingexpenses low.

2. Reduce your debts

Analyze any debts youmay have. Pay off those with the highest interest rate first - usuallyyour credit card expenditure. Pay a lump sum on your credit card orclose the outstanding amount, and reduce any other loan repayments.

Alwaysgive higher preference to closing the higher interest rate loans first.If you have a good credit standing with your bank, bargain with yourbank to reduce your interest rates or to adjust EMIs so they don'tpinch you. If your bank refuses to do either, look out foralternatives. Several banks offer transfer of outstanding amount oncredit cards or loan transfers.

Bear in mind that loans like Homeloan actually have Income Tax benefits associated. So, do somesavings-vs-expense analysis before closing that loan.

Always putmoney away for a rainy day and make sure you have a cushion of cashsavings. Do not dig into this entire amount to pay off your existingloans - it is in your safety to have some money stashed away.

3. Cut your spending

Makethis a priority. Think whether you really need that new flat-screen TVnow. Maybe going on your dream overseas holiday can wait one more year?Making sacrifices this year and living on a tighter budget will leaveyou much better off in the long run.

Cut down on frequent visitsto the local Multiplex. Instead, rent a movie from your nearby rentalstore and watch it at home, rather than spending hundreds on amultiplex!

4. Slash your Mobile and Internet bills

Saveon mobile phone usage. Often, your mobile connection plan might comewith low-cost add-on services like - National Roaming, STD and/or ISDconnection, GPRS etc. Analyze the services you really need and canceloff unnecessary ones - there is no point in paying monthly rentals forservices you don't really use.

Also think about downgrading yourmobile connection plan. Do you really need the Rs.499 rental post-paidconnection? Maybe you can switch to Rs.299 connection instead? If youare an user with a good-standing, you should not have a problem ingetting your Service provider to make these changes for you - for free.

Dothe same for your Internet connection. Think if you can downgrade yourInternet plan - or find a cheaper service. If you are going in for anew connection, compare all services available and bargain to get thecheapest deal available.

5. Save on Travel

Wheneverpossible, use public service for travelling. If that is not possible,you can try various alternatives. Does your company provide commutationto and from work? Opt for it. It could be way cheaper - and morerelaxing - than driving your car to work each day! If using Companytravel is not your cup of Tea, why not choose to Carpool or share aBike to work? Splitting costs even two-way would cut your expenses byhalf!

Save on Fuel - If you have been puttingoff on getting the LPG Conversion kit for your car, now is the time todo it. Change from Petrol to LPG version and see for yourself how yourFuel expenditure reduces drastically! By the way, take that walk fromthe Bus stop to your home rather than taking an Auto-Rickshaw. It's notonly free, it's also healthier!

6. Save on Electricity

Thisis another money-guzzler particularly since the scorching summer ishere and it is impossible to stay without the AC. So how can you saveon your Electricity bills?

Turn off lights and fans whenever youleave a room. Turn off your computer when you are not working. UseWater Heater (Geyser) and Microwave Oven minimally - both arehigh-power devices that draw a lot of power. These small savings willslowly, but surely, add up.

If you are planning to buy an AC tobeat the summer, choose one that has a certified Star rating for lowelectricity consumption. If you already have an AC at home, have itserviced regularly. Did you know that cleaning the AC filters would dowonders to improve the efficiency of your AC? You can do it yourself,but if you don't know how, have a certified service professional to doit first. Watch and learn so you can do it yourself the next time.

Turnoff the main supply to your TV when you are not watching the TV.Turning it off with the Remote is not enough as your stabilizer wouldstill be drawing power all night. If you haven't done it yet, now isthe time to change those old incandescent bulbs and start usingenergy-efficient lights (CFL).

7. Save on Food expenses

Reduceyour expenditure on eating out. Trust me, it can be fun to have thewhole family take part in cooking on the weekends! Try out new dishesright at home with your spouse and kids - not only will it be fun, youwould also end up saving more than half the money! If you do eat out,check for early evening offers, buffet deals, new restaurants withspecials and hotels that offer discounts.

Oh, and start taking your lunch to work. Not only would this save you money, it is a much healthier alternative!

8. Shop right

Whenyou go shopping for Groceries, plan your meals, make a list and shop tothe list. If you stick to your plan and your list, you won't spendmoney on all that food (particularly, junk food) that looks good butthat you don't need.

Avoid disposables, and use re-useablesinstead - disposables are a waste of money. Instead of paper towels,use washable cloth dish towels. Instead of paper cups and plates, justuse your regular dishes. Use cloth handkerchiefs instead of buyingtissues. Spend a few minutes to think about such small changes that youcan make to your shopping behaviour that can save you money.

Look for good deals before you go out for Shopping. Online Resources like can help you find the best deals in the market.

9. Avoid using Credit Cards

Lockyour credit cards away, and fight the temptation to use it. It wouldcertainly be tempting and easy to use Credit Cards when you are shortof cash - but it is a fact that you lose track of your expenses whenyou use credit cards. Use cash instead. Go to the ATM, withdraw somemoney and set that aside for household expenses. Try to limit yourexpenses within that amount. And when you find yourself short of cash,do NOT use your credit card - go to the ATM again. If anything, allthese extra trips to the ATM will be a deterrent and might actuallyreduce your expenses!!

10. Save on Gifts

Alwaysbe on the look out for good deals. Save by buying things under sale -for example, while shopping for yourself, choose a 'Buy 1 Get 1' offeron Clothing. Keep 1 for yourself and gift the other on your friend'sbirthday!

Create a collection of original gift ideas. Presentyour dear ones with hand-made gifts, a personally embroideredhandkerchief, fresh homemade pickles etc. They will appreciate yourskill as well as efforts and you will save a lot of money.

The Recession may not be the easiest of times to live through, butwith a little planning and disciplined saving and spending, it needn'tbe as bad as you think!