As the new way of working was introduced, few working people have supposedly moved back to their hometowns from their work location and are working from the comfort of their homes. . The work-from-home model also might have helped companies in saving their operating costs, such as rent and utilities due to lockdown in the country.
Along with rent, other expenses like transport costs, food bills, and much more have been saved for many. With the restrictions on going out, many unnecessary expenses have been reduced. Employees across industries who are working from home could save on commute costs, restaurant bills, etc.
Some ways to put your WFH savings to use:
If you are working from home, here are some ways how you can put your savings to use:
1. Top up an emergency fund
As the world has witnessed a sudden health crisis due to the pandemic, many people faced financial setbacks due to sudden health emergencies, layoffs at work, pay cuts, etc. It has become imperative for everyone to have sufficient financial backup to fight such health emergencies and financial crises. Keeping in mind the uncertainties, it may be considered preferable for people to top up their emergency funds kept aside for rainy days. Let’s say you have five to six months of your expenses kept aside as an emergency fund; it may be preferable to increase the same for a few more months, as per your convenience. The number of emergency funds that you need to keep aside may depend on the number of dependents you have and many other factors. The amount of emergency corpus would also vary depending on your industry or sector and the impact of the pandemic on those sectors.
2. Pay off your debts
Considering the uncertain economic situation, it is considerable to prioritise paying off your debts whenever you have additional money. It may not make sense to pay off all the debt. But you can plan debt repayments based on the additional savings that you make .
3. Serve your goals
Serving your goal must be your top priority when you are planning your finances. Additional savings can be rationally invested in some other investment plans to serve your long-term goals, such as retirement planning or for children’s higher education, etc. You could also use your additional savings for short-term goals like buying a vehicle or home or for enrolling in any professional courses to improve your skill sets.
Things to keep in mind
While you invest your additional savings for your future goals, it is important to keep certain key points in mind to put the work-from-home savings to better use. Here are the important things to keep in mind:
1. Make wise investment choices:
Making the suitable choice of investments is even more important than saving more. Specifically, when you are investing for the long term, consider the investments that are suitable for your need, goal, and return expectations. Insurance plans offered by life insurance companies like Bajaj Allianz Life Insurance provide multiple benefits like life protection, wealth creation, and tax efficiency subject to the terms and conditions of the policies and also as per provisions stated therein under Income Tax Act, 1961. Insurance plans offered by Bajaj Allianz Life Insurance1 like Bajaj Allianz Life Assured Wealth Goal, Bajaj Allianz Invest Assure, Flexi Income Goal, Bajaj Allianz Young Assure, and Bajaj Allianz Lifelong Assure, etc. are options for long-term investments for specific financial goals.
2. Consider the tax implications:
It is also important to consider the tax implications of your investment while investing your additional savings. There are many tax-saving options available to invest in. Investing in insurance plans offered by Bajaj Allianz Life may help you save tax outgo by claiming deduction upto Rs. 1.50 lakhs under Section 80C of the Income Tax Act, 19612. Moreover, if you opt for health riders, premium paid for health rider can be claimed under Section 80D of Income Tax Act, 1961.
Consider Investing your additional savings prudently for a successful financial journey. Make more of your work-from-home savings to secure your financial future.
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