Saving money is one of the many habits one needs to learn if they look forward to building wealth or attaining financial freedom.
Money may not be the most important thing in the world, but it sure does influence everything that is.
It affects your education, it affects your healthcare, it affects the well-being of your family, it affects the food you eat, and it affects the quality of life you get to live. It even affects how much respect you get from others in society – people tend to respect the rich more than they do the poor.
The more money you have, the better.
Therefore saving money is very important. Least you be looked down upon by everyone – your own family inclusive.
5 reasons why it is important to save money
Saving money is very crucial regardless of what stage you are at in life and how much you earn. Here are some reasons for you to adopt the practice if you hadn’t considered it much before.
1. Saving money offers one financial security.
Knowing that you can take a break from your job whenever you want to, knowing that you will survive comfortably if you got laid off from your job, and knowing that you have money set aside for any emergencies that might arise is a priceless feeling.
Knowing that you can comfortably pay your bills and you won’t get kicked out of your house for failure to meet the rent is indeed a very beautiful feeling.
We all need to experience the peace of mind that comes with financial security.
2. Saving money enables one to do what they love
It could be taking a vacation, spending time with loved ones, taking off some time to pursue a new hobby, and so on. Once you aren’t struggling to pay bills, you can easily give yourself some breathing space to do what you truly love.
3. Saving money offers hope for financial freedom
Once you have money kept away, that money can easily be put into investments or a business hence enabling it to accumulate, giving one a chance at financial freedom.
If you don’t find a way to make money while you sleep, you will work until you die.
Warren Buffett
Knowing you don’t have to worry about money for the rest of your life and do not need to work a job must be a pretty amazing feeling. You get to use your time as you like.
4. Saving money can enable you to fulfill both short and long-term goals.
It could be building a business, buying a home, buying that nice car, taking that vacation of your dreams, going back to school, or even attaining a comfortable retirement.
Whatever it is you dream of, having money saved will do you a lot of good.
5. You don’t need a reason to save money; just save.
You do not need to save for anything in particular – just save. No matter how well you’re doing in life right now, you’ll never know when your savings could come in handy so just save.
You could lose your job, you could lose everything you have because of bad health, a bad investment, a car accident, your flourishing business could collapse, and so on. Since we can’t predict future events, best we prepare for them accordingly.
The reason I call saving money a win-win strategy is because you will never regret saving it, something could always come up that requires the use of that money.
And if nothing ever comes up, at least you gained some interest on your money plus financial security. Knowing you have some money to fall back on in case of anything is a priceless feeling so whichever way things turn out, it’s a win-win situation.
8 tips for saving money
Now that you know the importance of saving money, you might be wondering where to start, or even where to get the money to save.
First off, everyone can save some money no matter how little they earn. Here are a few tips to get you on your way.
- Identify wants from needs.
Once you’ve ascertained what your needs and wants are, you can always forego some wants and put that into your savings. It could be that $5 latte you have during breaks, that expensive lunch and so on.
Beware of little expenses; a small leak will sink a great ship.
~ Benjamin Franklin
Just reduce money spent on wants and put it into your savings.
- Clear up debt as soon as you can
The longer you keep debts, the more you pay in interest. If you clear up your debts as soon as you can, you could allocate that formerly interest money to your savings.
- Use cash or debit cards instead of credit cards
Credit cards may come in handy in clearing bills and purchasing stuff but they have high-interest rates. Debt is one thing you will want to avoid if you are to save some money for yourself.
- Avoid careless spending
This could mean eating out less for you, it could be cutting on how much you spend on salon (for most ladies), reducing the amount you spend on entertainment subscriptions, whatever it is that will help you spend less is a win, do just that.
- Pay yourself first
Before you go spending on all other things, set aside a percentage for yourself – for your savings. It could go to your savings account or some well-thought investment.
- Live below your means
Just because you earn $1000 every month doesn’t mean you should spend $1000 every month. Make a monthly budget and save as much as you can.
- Put any excess money into your savings
Say you got a raise at work, put that excess into your savings account instead of buying all the bigger and better everything you might be already thinking about.
You have lived on less before, you can still do it and save the rest for whatever may come up.
- Buy genuine high quality products
Instead of buying cheap, low-quality items, buy quality items that come with guarantees. They may cost a little higher but are sure worth the cost. That will save you a lot in repairs plus they are more durable and you won’t be buying another at least for a while.
Closing note
The importance of saving money can not be stressed enough. But if you desire to attain financial freedom for yourself and your loved ones, saving money is the first step in the right direction.
Even if you don’t have something planned to use the money for yet, just save so that when the need presents itself, you have a starting point.
Getting wealthy is more about how much money you can save and invest wisely than how much you make.
Beautifully crafted article .. this is the biggest lesson that we as the youth today need
[…] environment. It’s easy to let our emotions get the better of us when it comes to managing our money and making financial decisions, but a little planning can go a long way toward making sure that we […]