The road to financial freedom is rarely easy. It’s filled with complications but personal finance is something you need to focus on regardless. Unless you want to live life constantly worrying about finances, you need to master the one habit even self-made millionaires attest to have changed their lives for good. And it’s the habit of saving. Here are some of the ways saving money can change your life too:
Saving lets you pay yourself first
When you save money rather than indulge in shopping sprees or impulsive purchases, you’re basically paying yourself. You’re not only thinking of what instant gratification you may enjoy but you’re thinking of the future. To prioritize saving more than anything else, you are like giving yourself a tap on the back for working hard. As payment for such hard work, here’s some savings to guarantee your future. Nothing says paying yourself best than that.
Saving comes handy during emergencies
When you have sufficient money in the bank, you never have to worry about financial emergencies. Whether it’s as unexpected as your car breaking down or something major like a medical emergency, your savings can come handy to take care of these things. Money saved for the rainy day eliminates the need to borrow personal loans with high interest rates. Saving money no matter where you look at it only offers advantages you’d benefit most from anyway. So you should save money not only to take care of the future but also of financial emergencies.
Saving sets you up for financial success
When you’ve developed the habit of saving and it’s become a part of your lifestyle, financial success is on the horizon. Self-made millionaires have confirmed it and financial experts reiterate it time and time again. If you know how to save, you’ve set up yourself for financial success. Before you can enjoy financial freedom, you need to save first in order to have enough money to invest to high-paying investment products, a business and eventually for your retirement.
Now that you’ve confirmed that saving indeed can change your life, the next question to ask is how to save money? Saving money on paper seems like an easy habit to master. But it’s really not when you’re confronted and bombarded with irresistible store sales and deals, insufficient income, financial emergencies and more. If you badly want financial freedom, however, there shouldn’t be any excuses to keep you from doing what’s needed to be done.
If you’re ready to save money, there are really only two things you need to keep in mind. Prioritize it more than anything and make it automatic.
To effectively save money, you need to do it first thing when you receive your income. When you’re making a budget, saving should occupy the first item on your list. Saving doesn’t have to be big to get start. You can start off small like setting aside 3 to 5% of your income to savings. You can increase the amount as you go. Just make sure that you’re saving consistently month after month.
To make it even easier to save money, you can tap on your bank’s automatic deduction feature. You can open another account and set-up an auto-debit transaction per month. As soon as you’re income has been deposited to your account, the bank will deduct the appropriated amount and transfer it automatically to your savings accounts. This makes savings a whole lot more convenient. Soon enough, you won’t notice the deduction and it will be easier to live with what’s left of your income after savings.