Everyone Needs a Savings PlanBuilding Savings
No matter your income, marital status, or job prospects, you should have a saving plan. In fact, you need two plans: short-term saving for maintenance and emergencies, and long-term savings for planned purchases or investments.
When you read the success stories of self-made millionaires, you will find that just about all their finances include similar factors, especially savings. Many started out in low-paying jobs as taxi drivers, restaurant workers, or office cleaners. But as they began saving part of their income, they were able to eventually invest in a successful business venture or an investment that led to long-range success.
If you don’t already have a monthly budget, make one. Add to it a short-range savings plan for unexpected needs, like unplanned holiday guests, and emergencies, such as a car repair. The amount you save can be as low as $10 a paycheck, but many financial experts recommend putting away about twenty-five percent of your take-home pay if you can afford it. Occasional, rather than regular, expenses like school clothes or a family vacation can be paid for from this fund to stay within your monthly budget.
Although it may seem challenging to save money each month when you live on a tight budget or low income, it is really a necessity nowadays, and you will be glad you did.
What about long-range planned purchases, such as the next car or a college education? Investing a small amount each month now can compound in interest and add up to a sizable sum when needed. When you add extra income like job bonuses or pay raises, the fund can grow more quickly. You may eventually decide to invest in a second real estate property or build a balanced stock portfolio. Over time, your long-range saving plan will earn money and repay many times over what you put into it each month.
No one ever became rich by spending everything they earned. The well-off people of today began their journey to wealth by saving whatever they could afford toward a future goal. When they met that goal, they set another, larger goal, and continued this method until they achieved their financial objectives. To maintain a secure household budget now and support future monetary goals, start at least one account to save your money with monthly deposits as a first step toward reaching your financial dreams.