4 Reasons Why Saving Money is Crucial!

Wednesday, February 5, 2020, 6:00 AM | Leave Comment

So, saving money. Do you think it is important?

In case you do, well you might be one of the few ones. There are lots of people who do not consider it to be a real priority and that is quite weird to me.

Saving is even more important when you have little, and there are many ways to save money on a tight budget.

Let’s have a look at reasons why saving money is so crucial.

  1. Cash Cushion

    Goes without saying – if you have some money stored on the side, life does not seem so scary anymore. You know that you will be able to deal with a variety of unfortunate situations if they materialize.

    Lots of things can happen and money can solve most of them. Having some money on the side makes it easier to cope with the anxieties that life brings.

  2. Confidence

    When you have a cash stash, it makes you feel a little different. There is a confidence in your step. You know that if your boss start to bully you, you can quit. Because you will be able to sustain yourself for several months. This is why you need to save, so you can take charge of your life.

    It allows you to make decisions that you actually want to make, instead of always having to submit to the decisions of others as you have no alternative.

  3. Debt repayment

    If you manage to put money on the side, you will be able to repay your debt quicker. When you repay debt quicker, you pay less interest. When you pay less interest you can save even more money. So the spiral goes on and on in your favour.

    Credit card interest is very high, having money on the side will allow you to get rid of it.

  4. Investments

    Saved money will allow you to make little investments here and there. You may go for something conservative, or try to branch into something more risky.

    Having even small investments will make you feel more confident (as per point on). You will feel that you growing your treasure chest and you will act accordingly.

    Even though initial investments may seem small, they will accumulate in time. You have to start somewhere right? It is always the first step that is the most difficult.

  • There are ways to save money on a tight budget – so literally anybody can start. You do not have to put away big sums, even smaller amounts will be a great start.

  • Other important note – consistency. You have to be consistent about your savings, you can not spend you hard earned and hard saved money at the first opportunity.

  • Sure there will be temptations, but you must make saving money a habit. Or rather your style of life. You have to strictly differentiate between the things you really need and want.

  • Habits are formed roughly in 30 days. But since you can save money only after your payday, give it 2-3 months. You will see how great it will feel when your savings account will start growing.

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