Most of the millennials and Gen Z must be at a fairly settled position in their lives. Most of them have had their education completed and have probably started earning.
As per a latest report, the average earning of the millennials is around 70k per month. It means that if any of them works for 6 months, he must be easily able to accumulate 50k as a surplus amount after meeting all the expenses.
Now, having a surplus amount means that there will be n number of plans for spending that amount. Let’s have a look at the most probable plans:
• Planning a holiday: After months of hard work, all of us need a holiday. While it is beneficial from recreational purposes, once you come back from the holiday to your daily routine you are left with no funds and only memories.
• Down payment for vehicle: You can use the surplus amount to make a down payment for your car or bike and opt for a loan for the remaining amount. Vehicle is a depreciating asset, bundled with the interest of the loan.
• Stock Market: You can plan to invest your amount in the stock market. You can take the help of a certified investment advisor and invest in some potential stocks. While the stock market has risks, but there are chances that you will get very good returns on your investment amount.
• Higher Education: You can plan for skill training or any other higher education program that you always wanted or needed. You will be left with no money but the knowledge and skills you will gain will probably be more valuable.
• Saving: You can simply put the surplus amount in your savings account and get appropriate interest as per your bank on the same. While the interest rates on savings account are very minimal, it is probably the safest option available.
• Fixed Deposits: You can also put the amount in a bank fixed deposit and earn higher rates of interest compared to savings account. This is also amongst the safest options available but the interest in case of fixed deposit is also very low.
• Mutual Funds: You can plan to invest your surplus amount in mutual funds. While mutual fund investments are subject to market risks, they offer good amount of returns if maintained for longer periods. Investing directly in stocks will yield more returns but mutual funds are comparatively safer.
• Gold: You can invest the surplus amount and buy gold for the same. The rising gold price are expected to provide you good returns with time but the safety of gold is a matter of concern for long time.
• Shopping: You can probably buy that high-end cell phone or a smart TV but again these are depreciating assets. You will hardly get even 50% of your investment just after a month.
There can be various possibilities of spending and investment with any surplus amount you have. It is important to plan your expenses smartly and as per your need. Unwanted expenses can not only hamper your financial stability but can also affect your future goals. Investing surplus amount in order to get satisfactory returns after a period of time, and using those returns to manage your not so necessary expenses is recommended.
Data is updated on 7th per month. It gets verified every quarter by independent auditor.
Data presented here is taken from company's inception
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