Saving money? What for?
Aug 12, 2019
Very few people these days are in the habit of saving money. Not only for future purchases we would like to make but also to be prepared for a future that’s full of uncertainty and changes. It’s important to consider that for younger people in different countries in Latin America and the world in general, we will find a huge difference regarding retirement funds we will have access to. There have been many changes that affect the new generations, therefore it is very important to learn to save from an early age and thus have financial security later in our lives.
These days where we’re surrounded by credit cards, we somehow think that the available funds in these cards are ours already and we spend without moderation. We don’t make a budget for our expenses and then we have difficulty fulfilling our financial responsibilities, pay our credit cards, pay other debts, and we don’t have the chance to enjoy the fruits of our efforts.
There are times when because of an emergency it will be necessary to use a credit card, that’s why it’s a good idea to have one available. But not to use to for our typical expenses unless we do it strategically to get other benefits and pay it off every month. We need to save for our expenses and not spend more than we earn.
But it’s not always easy to start saving money and that’s why we have a series of suggestions for you to begin saving money:
- Give a specific reason to each goal, perhaps a trip or something you would like to buy.
- Make a list of those goals and decide which ones you will focus on, it can be more than one at a time. Just remember that this must motivate you to keep saving and if you start with too many goals at once you could get overwhelmed and give up.
- Review your expenses to analyze what you’re spending your money on and what you could modify or trim so you can start saving that money.
- Decide how much you will save per week, two weeks, or per month. Decide which option is more suitable to your lifestyle.
- Make the most of extra earnings, there is some additional income during the year like bonuses, savings funds, or profits that can be used to save. Of course you must also enjoy them, but saving a partial amount will help you think more clearly about how to spend your money and not waste it.
- Don’t go to extremes, save within your means without going so far as to not enjoy anything. Be careful and intelligent with your decisions and everything will turn out well.
Additionally, to give you a boost, there are different methods with which to save money almost without realizing it.
- Start a planned savings program. There are bank apps you can configure so that they set aside a percentage or a certain amount of each payment you receive. So when you log into your bank account, you only see the amount you have available to spend, and your savings will go into another account which you can access at any time should you need it. If your bank doesn’t have this, you can do it yourself by opening an additional account.
- Make a budget for your expenses. Having a budget and sticking to it as much as possible will help you focus on the small expenditures which tend to add up to large amounts. Remember to occasionally include in your budget a small luxury for yourself…you deserve it! You can use apps that help you do it automatically so that you can manage your expenses.
- Join a retirement plan. It’s important to start preparing for the future, individual retirement savings plans are tools that will help you save and grow your money with yield rates on your savings. Educate yourself about the risks and benefits and join a provider that is most suitable to your needs and with whom you feel comfortable.
- Devise additional savings challenges. There are many challenges you can do and here are some examples.
- Save in weekly increments. Choose an amount you feel comfortable with and start saving it, increasing it every week. For example, Week 1: $2, Week 2: $4, Week 3: $6. You will be surprised at the amount you will be able to save in one year, in this example it would be $2,756 in savings.
- Save all the coins you have at the end of the day. This activity is easy as well as fun. Use a container that will allow you to see how the number of coins is getting bigger and when it’s full, take it to the bank where you can deposit it. It’s amazing how much money you will be able to save in a short time.
Remember that every change in habits takes time and perseverance. Begin with a pace you feel comfortable with and make it more complex as time goes by. This way, you will avoid being overwhelmed with a big change, and in a short while you will even do it without thinking and will see great results.
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