These days, the notion is saving money seem archaic with overdrafts, online banking and contactless cards making it easier to spend like there is no tomorrow. In essence, most spender often wonder why should they save when there is readily available credit? Time to unveil why savings make you a happier and secure person.
BEING FINANCIALLY FREE TO LIVE A GOOD LIFE
There are so many things in your future that you won’t be able to control, by saving some money you can step up to your financial affairs. You can only gain from putting away some money to help you to take control and organising your future. Get advice on stocks & shares ISAs and start early to save for a rainy day as well as for your retirement.
It also releases you from the stress of not having to live from month to month and fearing any potential crisis or emergency that will require an immediate injection of cash. Savings enable you to invest in a business, further your education, switch careers, or to take a holiday when you want. However, probably the biggest investment these days is one geared toward retirement and saving makes it easier to do so when you want as opposed to when you must.
To be able to make choices without dipping into your monthly savings gives you the financial freedom to call the shots on expenses. Having savings and financial independence to depend on gives you the freedom to truly enjoy life.
Other than a house, the second most expensive thing you will probably buy in your lifetime is a car and most people need to get a car loan from a bank along with the interest repayment attached. You cannot buy a new car without a deposit and when you put down a decent deposit your monthly instalment would be lowered too. You could take it from a credit card but at a higher interest rate and how will you get ahead? The better option is to save as large a down payment as possible which will also decrease your monthly repayment.
Another option is to save up and buy your car outright. This isn’t achievable for everyone but more people can do it if they look at the second hand car market which is what I did when I bought my little BMW 1 Series. I wrote all about maintaining it and tyre care in this post if you’d like to take a closer look at it.
BUYING A HOME
When you are planning to own a home, you need to know that there are about 5% of other fees and costs that will be added to the final purchase price of the house. You will also need a deposit which you cannot borrow from the bank. This amount required is usually round about 5% to 10% that you will need to have saved up, the remaining amount would then be added to a binding mortgage agreement. Having savings can open the door to your new home.
EMERGENCIES & UNEXPECTED EXPENSES
What will you do if you suddenly have repairs on your house or your car has a breakdown, a family member develops a health issue and you need to take an emergency trip? Do you have the extra money on hand?
It is always better to be prepared and have money saved in case of a scenario like this, as these unexpected encounters can be expensive.