“Why should I worry about putting money aside each month?” Why do people insist on saving money when you have enough to pay for everything you need? Well, they know the importance of saving. Different people save for diverse reasons.
Saving is easier if governed by ethics and a clear purpose for the money you are saving. Here are a few questions which can help you realize the importance of saving:
- Do you desire success due to life demands?
- Do you eventually desire financial freedom?
- Do you understand the real purpose of wealth?
- How is your pre-retirement plan?
Before saving, it is vital to get skills to control money down to the cent. Programs such as financial training and counseling and planning for the future can get you started. You need to:
- Get in the right mindset; saving is more than a habitual practice.
- Start small and grow big into saving; every shilling counts.
- Make saving automatic; have your bank automatically transfer money into your savings account every time a paycheck is deposited, you won’t even see that money for long enough to consider spending it. If auto-transfers make you feel a bit out of control, take on that responsibility yourself.
The Importance of Saving: Benefits of saving
There are inexhaustible ways you can benefit from being cognizant and diligent about saving:
- Gain financial freedom
Financial freedom is what everyone dreams of. Financial freedom means having the financial independence and savings to depend on and having the freedom to make choices in your life separate from earning a paycheque. You have the power and capability to take a vacation whenever you want to, start your own business or enroll in an investment service, and much more.
Financial free individuals do not rely on receiving a particular pay. Having savings that you can count on is what it takes to become “rich,” no matter how you define it.
- Generate wealth through investing
Investing, for instance, in as the stock market, is one of the most fabulous ways for individuals to build wealth, but it’s necessary to have the capital to create wealth through investing. Investing is one of the best ways to accomplish the goal to be financially secure, but it is saving continually over time that provides the required capital.
- Emergency cushion
Saving builds a safety net which can serve as a buffer against unexpected lifestyle changes and cataclysmic events. This could be any number of things: a new roof for your house, out-of-pocket medical expenses, or sudden loss of income. You will need money set aside for these emergencies to avoid going into debt to pay for your necessities.
- Save for retirement
If you retire someday, you will probably need savings and investments to take the place of the income you’ll no longer get from your job. We all want to avoid the enormous emotional, psychological and physical consequences to live stressfully, from hand to mouth, paying cheques in our retirement years.
- You develop experience
One doesn’t become a proficient saver or investor overnight. It takes time to build the financial discipline necessary to save when you can, and the same goes for developing the analytical skills needed to estimate the value of a security or to distinguish a mispriced asset from one with limited growth prospects. Through programs such as the Unda Ajira Hub, by Lan-x Africa Limited, young investors are trained to ignite their entrepreneurial spirit and starting building their skills early and over the long term.
If we fasten our attention on what we have, rather than what we lack, a very little wealth is sufficient. -Francis Johnson