Saving money is easier said than done. Here are 8 reasons why you should start saving money today.
8 Reasons Why You Should Save Money: If you’re not saving money, you’re spending it unwisely. Some people spend money on things they don’t need, while others spend more than they can afford to lose financially.
8 Reasons Why You Should Save Money
While the reasons why people save money vary from person to person, there are certain reasons that most people will agree with and find compelling reasons to start saving today. Here are 8 popular reasons why you should save money!
Saving money can improve your life
Just about everyone can use a little more money in their pockets. Whether you’re looking to save for a major life event, like retirement or college, or simply want to put aside money for an emergency fund, having enough money set aside makes life a lot easier. Instead of worrying about cash, or asking family and friends for loans all of the time, you can stop stressing and start focusing on your financial future.
That’s why it’s so important to start saving now—before you need that extra cash in your bank account. Here are 8 popular reasons why you should make saving money a priority! 1. It helps you live a better life: When you don’t have enough savings, you might be forced to rely on credit cards or loans from friends and family members when emergencies arise.
However, if you have a healthy amount of savings, those kinds of emergencies won’t seem as stressful because you know that there is money set aside for them. For example, if your car breaks down one day and needs repairs right away, then it will be easy to pay for those repairs without feeling any stress at all because there is money in your savings account waiting to be used when needed.
Saving money will make you happier
A 2015 survey from GOBankingRates found that 57 percent of Americans who earn $150,000 or more per year and have more than $500 in savings said they were very happy. This is compared to only 29 percent of people who made less than $35,000 per year and had no savings. The same trend holds true when you look at age demographics.
Fifty-six percent of people between 18 and 24 years old with no savings said they were very unhappy, compared to 23 percent with more than $500 in savings. Saving money also allows you to live life without as many regrets: Wouldn’t it be nice if you didn’t wake up every day regretting one thing or another? How much better would your life be if you could take back some of those regrettable decisions and start over? One way to do that is by saving money.
If you don’t have enough saved for an emergency fund, then you can’t afford a sudden change in your circumstances—like losing your job or getting sick—and being forced into debt. But if you do save for an emergency fund, then it won’t matter so much what happens because you’ll still have a buffer between yourself and financial ruin. That peace of mind will make all the difference in how happy (or not) your future looks.
Saving helps you sleep better at night
According to a 2007 study published in The Journal of Consumer Research, saving is associated with a greater sense of well-being. In fact, people who saved regularly reported better mental health and fewer negative emotions than those who didn’t. Socking away even small amounts can contribute to big feelings of peace of mind.
So set aside some cash each month, or even create separate accounts for specific goals (like a home or vacation). You’ll feel more optimistic knowing that your savings are growing. How much should you save? If you’re not sure how much you should be putting away, check out our guide on how to calculate how much money you need to save for retirement.
There’s also a rule of thumb known as The 50/20/30 Rule which suggests that you save 50% of your income toward necessities like housing and food; 20% toward discretionary spendings like travel and dining out; and 30% toward retirement savings. Use these numbers as guidelines rather than strict rules—after all, everyone’s financial situation is different! What matters most is that you have an emergency fund so that if something comes up, you’re prepared. And if it doesn’t?
Saving gives you financial security
How can you sleep at night if your family is always worried about paying their bills or living paycheck to paycheck? Make sure that you have a good cushion of savings so that no matter what life throws at you, you can always find a way to bounce back. Not only will it ease stress, but it will also provide peace of mind. Without financial security, everything else in life seems unimportant because we are constantly thinking about how we’re going to pay our bills.
If saving money isn’t a top priority for your family now, make sure it becomes one before trouble strikes! The truth is: that nothing brings peace like having money on hand. It doesn’t matter whether you want to save up for retirement, a house down payment, an emergency fund, or something completely different; if you don’t save today, you could be short-changing yourself tomorrow.
Small steps lead to big successes
It can be a tough pill to swallow when you look at your current income, determine how much you need to save per month, and then realize that in order to save that much money, you’re going to have to cut back on some of your favorite luxuries. Don’t fret! There are still ways that you can continue living life without having to deprive yourself. Here are a few ways that will help keep cash in your wallet.
Start Saving for Short-term Goals First
Whether you’re saving for a car, a vacation or to put a down payment on a house, it’s easy to get overwhelmed by long-term goals. That can leave you with no savings in your checking account or inconsistent contributions to your 401(k). It’s important to recognize that saving for short-term goals first is an important step toward making your longer-term financial plans come together.
Put money into high-yield savings accounts and make small but consistent contributions toward larger financial goals. For example, if you want to buy a new car in two years, save $200 per month until then. If you want to travel abroad next year, start putting away $100 per month now. When you reach these milestones, take some of those funds and apply them toward your next big goal.
Change in Mindset Leads to Change in Behavior
To change your spending habits, you first need to change your mindset. Before you can increase savings, you need to really believe that it’s a worthy goal and make it your top priority. People often say they want to save more money, but when push comes to shove, their spending habits don’t change. The question is why? What keeps people from saving more money?
According to Sonja Lyubomirsky in her book The How of Happiness: A Scientific Approach to Getting the Life You Want, people have a different mindset toward spending than saving. Spending is associated with immediate rewards while saving isn’t. We feel good when we spend our money on something we want now, but we feel guilty about not having enough for retirement or our children’s college fund.
Most of us are aware that saving for retirement will bring long-term benefits, yet we still find ways to spend instead of putting aside cash for later use. If you truly want to change your behavior, start by changing your mindset about how important it is to save for future use. Saving must become as important as spending if you ever hope to reach financial freedom.
Saving does not have to hurt!
Saving money doesn’t have to hurt; you just need to know where to start. Most people are saving for a rainy day, but there are many different ways you can save your hard-earned money. By starting small and making smart decisions, you can begin saving money in no time. Here are some tips on how to get started If you want to save money, don’t be afraid of coupons: It is easy to overlook coupons when shopping because they aren’t always readily available.
However, if you plan ahead and look out for coupons before heading to stores like Target or Walmart, it’s possible to find them on items that will help lower your grocery bill. Coupons also make it easier to buy products that may be more expensive without sacrificing quality. For example, if you buy baby formula with a coupon at Walmart instead of buying name-brand formula at Target, then it may cost less than $30 for an entire month’s supply of formula.
Also Read: 10 Credit Mistakes You Should Never Make
There are lots of different reasons why you should save money. __________. Saving your money can help you achieve financial freedom and avoid debt. Even if that doesn’t sound like a goal you want to work towards, saving is still beneficial because it gives you a nest egg for unexpected expenses and saves your cash from being wasted on impulse purchases or being used up in fees from banks or credit cards.
Remember one day, those pennies will add up to dollars! Saving just $100 per month starting at age 20 (with an annual rate of return of 8 percent) would leave you with more than $52,000 when you retire at age 65!