Having you here reading this article suggest that you are searching for reasons to save money and be financial independent. So, put in mind that you have come to the right place.
As we were all aware that money is the most influential asset in this life. But getting a continuous source of enough money to cover our daily spending is becoming harder every day. Therefore, saving money is becoming almost mandatory in today's life.
Even though, according to research carried out by Bankrate, almost 1/4 of Americans are not saving money at all. While half of them are left behind in terms of saving money for future use.
But in my perspective, many people are not saving because, they don't know why they should save money.
Therefore, I would like to figure out the top reasons to save money in today's article. Some of which are; having financial independent, paying off debt, traveling around the world, buying luxuries, being financially secured, preparing for emergencies and many more.
Without wasting much time, below are the top reasons to save money.
Reaasons to Save Money
Below are the top important of saving money. You can go trough them to find out why you should save, and also how to save money effectively.
1. To Buy Luxuries:
For you to buy a new house, car, an expensive phone or any expensive luxury, you need to save some reasonable amount of money. Because you daily earnings might not be sufficient for that purchase.
In some cases, you might request for a house or a car loan from bank. However, you must drop a part payment as a down payment before getting a house/car loan from any bank.
The down payment ranges from 5-20% depending on the bank you are requesting the loan from. Consequently, you are not allowed to borrow the down payment. So, by saving money, you can easily settle the down payment and get a chance to own a house or a car.
However, you might afford to pay the entire price and save a lot on interest if you have the habit of saving money for future use. So, this is also among the benefits for saving money.
2. To Build Your Own Business:
Building a new business, especially from the scratch need a huge sum of money. Because, you must have enough money to start the business itself, manage it, pay salaries, and pay for advertisement before the business grow.
However, if you are not someone with multiple and steady source of income, you must build the habit of saving money for a certain period of time before achieving the goal of building your own business. So, this is also among the importance of saving money.
Likewise, I would also suggest you to read my post on understanding bear market to avoid capital lose while building your business.
3. To Have a Good Life After Retirement:
According to normal circumstance, any worker/employee must be retired from his job weather he likes it or not.
Likewise, the saddest part of this story is that 99% of employees, especially people working with government agencies are 100% salary dependent. I.E. they don't have any alternate source of income.
Therefore, as an employee who only depends on salary to run his life, you better build the having of saving money since from day 1 in order to have a good life after retirement.
In a simple term, having money after retirement make your life enjoyable. “I save because I want my future self to have the same great lifestyle I have now, and I don’t want to get caught in a financial emergency,” says Kara Perez, who established a company that offers financial education with a mission to empower women by giving them the knowledge and resources necessary to achieve their financial objectives.
Therefore, if a personal finance expert like Perez is Saving money to have a good life, why can't you?
4. To Travel Across the World:
As someone who is always willing to travel around the word and learn new cultures, this is among my best reasons to save money. Because, traveling to developed countries like England, Australia and United States is very expensive.
Likewise, depending on how long you want to travel, what country you wish to travel to, and what kind of travel you like, you will need to save a certain amount of money to cover your travel expenses.
Additionally, having a saved money for your trip will enable you to enjoy it fully without worrying about whether you can afford this excursion or this hotel.
5. To Cover Your Children's Educational Needs:
The cost of higher education is rising day by day. So, you should create a savings account for your children if you intend to effectively pay for their education needs.
Even though saving for college is expensive, it is not impossible, especially if you begin while your children are still young. You can check the below inforgraphic to find out how to save money.
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However, access to higher education might vary greatly between countries. For instance, while attending university in France may be absolutely free, it may cost hundreds of thousands of dollars in the United States.
Additionally, educational need is not only the price of attending college. It also relies on your ability to pay for things like hostel, books, transportation, meals, pocket money and so many other things.
Therefore, even though college is free in some countries, if you don't have any funds, you might not be able to cover your children's educational needs! So, this is among the key reasons to save money in my perspective.
6. To Avoid or Pay Off Debt:
One of the biggest mistakes we make in this life is spending money we don't own. I.E. putting ourselves into dept.
However, in some critical situations, you must borrow money from your bank, friend or used your credit card due to lack of proper saving plan. So, you supposed to start saving for you to pay off that debt and also avoid being trapped in another one.
7. To be Prepared for Emergencies:
Preparing for emergencies is one of the best reasons to save money. Because, nobody knows what's going to happen tomorrow.
As we all know that this life is unpredictable, anything can happen at anytime. So, we supposed to be prepared for emergencies like; car accident, flooding and heath issues before they arose by saving some reasonable amount of money at regular intervals.
8. To Pay For Big Expenses:
There will be time when you have to pay for big expenses like home and car. Likewise, as a small business owner or a low salary level employee, you can't afford to pay for that expense if you didn't plan and save money for it.
Therefore, big expenses are unquestionably reasons to save money. Because, we can only afford to pay for big expenses without leaving a huge hole in our personal finances if we save money for them.
9. To be Financially Secured:
In my perspective, this is among the most important reasons to save money. Because, you will only be financially secured in situations like emergencies and sudden expenses if you have the habit of saving money for future use.
Otherwise, you may fall into debt whenever you find your self in an emergency situation.
Kara Perez, the founder a financial education company advises saving money in both a liquid savings account where you may keep cash for emergencies and unforeseen costs, as well as a brokerage account where you can make future investments.
10. To be Financially Independent:
Finally, being financially independent is among the top reasons to save money. But I prefer to round up my article with it because, I would like to differentiate financial independence from being rich.
Firstly, financial independence could entail taking vacations whenever you want, quitting your job and returning to school to pursue a different career, starting your own business or investing in someone else's startup, accepting a lower-paying position that is more personally fulfilling than financially rewarding, and retiring when you want to instead of working just because you have to.
Although achieving financial independence is not the same as being rich, but the freedom from being dependent on a regular paycheck can make you feel incredibly rich.
Therefore, regardless of how you define "rich," having dependable funds is a requirement. So, it's advisable to save money for you to have dependable fund and become rich.
Conclusion
Finally, I hope you will start saving money today. Because, this life is unpredictable, anything can happen anytime.
Likewise, saving money open the door to many opportunities for you. Some of which are; building your business, paying off debt, getting financial freedom and also traveling around the world.
It can also give you an interesting and worry-free life after retirement (the hope of every employee). So, I manage to provide you with the most important, but not all the reasons to save money.
By the way, you can start saving money by stopping all unnecessary spending and building a genuine saving goal. You can also start saving by keeping a small portion of your salary and also the refund you get from online purchase and taxes.