As you’ve probably grown up hearing, it’s important to always put aside some of your monthly income as savings.
Whether you’re saving for something you want, such as a house or vacation in the short-medium term future, or whether it’s to have a nest egg to fall back on when you reach your golden years, financial security in the future is something that’s really a top priority.
Even if it’s not something you’ve given much thought to, saving for the future can be started at any time, so it’s not too late to start making a plan now.
If you still need a little convincing of the real ways it can benefit you, here are a few that we picked out:
You have a cushion if you lose your job:
As we’ve seen many times, and most recently when the economy crashed in 2008, it’s fair to say that the economy isn’t always the most stable, and although you may be in a stable and high paying job, there are many outside factors that can really cause that to change, sometimes overnight.
So, it’s always a good idea to have a back up plan to ensure that should something like that happen again, you don’t go completely broke and end up losing your home as a result.
Saving directly in cash doesn’t have to be the only way you prevent things like. As an example, when applying for your residential mortgage, you can look into things like plans that allow you to pay higher amounts each month without only paying interest so that your mortgage is paid off quicker.
This means if the economy does tank, you won’t have to worry about how you’re going to cover your mortgage.
You have something to leave your kids:
If you’re a parent, you know how good it feels to be able to help your kids with anything they need, and if you have a lot of money saved up in your old age, then since you can’t take it with you, it will be a nice feeling to know that you can leave it for them and help them have some financial security.
You can help your family:
Having money in the bank means that you don’t have to wait until you’re old or no longer have a use for it to start helping out your family. Whether it’s buying your child their first car, helping them save for college, or even giving them a deposit for a house, you can help them out if you have the money to do so.
You can do things you enjoy:
If you’ve always wanted to travel, take up a certain hobby, or really just to not much at all, then once your family is all grown up and you’re able to retire, if you have a good amount of money saved up, there are now plenty of options for you to be able to do these things.
Although this list is certainly not extensive, we hope it’s given you an idea of at least some of the benefits you can enjoy from retiring and putting aside some money each month to do so.
Budget to help you manage:
The first step that anyone should take towards managing their finances effectively is creating a budget. A budget is essentially a tool that you can use to determine how much money you have coming into your bank account on a monthly basis and how much you can accordingly afford to spend in different areas in your life.
When calculating your income for a starter figure, you need to make sure to immediately deduct any legally imposed payments. These can include things like tax and national insurance contributions. Once you have deducted these, you will be left with a figure to work with. Now, cutting back on non-essential spending is easy.
You just treat anything that isn’t absolutely necessary as a luxury and cut back in these areas if you aren’t bringing in sufficient cash to justify paying for them. Luxuries can include clothes, gadgets, entertainment, and other things that you don’t absolutely need, but rather simply want. However, there’s no need to stop here when it comes to saving and living to as low cost a budget as possible.
You can minimise your spending on the essentials too. Here are just a few areas that you may not be able to completely cut out, but that you can save money on!
We all require energy to fuel our properties. We need electric and gas to at least:
- Run Our Appliances – we need the food in our refrigerators and freezers chilled and frozen, we need to be able to cook hot meals, and we need to be able to wash our clothes at least.
- Heat Our Properties – we need energy to heat our homes during the colder months of the year.
- Light Our Properties – we need to be able to light our properties at night when the sun sets.
So, chances are you can’t really get out of paying for these bills. However, you can save significant sums of money by reassessing who you choose to provide you with your energy. There are plenty of suppliers out there and competition is fierce – many will cut their prices in order to undercut their competition and guarantee your custom. So, browse around.
You can use different price comparison services to see which provider in your area can offer you the best deal. If you don’t want the hassle of switching provider, you can still scout out the best deal and ask your current supplier whether they’ll match it – chances are that they will in order to encourage you to stay with them.
Follow my article on Budgeting the right way …==> Saving or Spending.
There is no good or bad ways on Saving Money, we just have to find a way that make us fell
comfortable doing it… My best tip? Just start and adjust week by week!
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