There will always be something that you could buy, but what happens when you find something that you really want – or even need – to buy and can’t afford it? Saving today means that you will have the money when you need it tomorrow, or the next day, or the next.
Saving money today will do more than stockpile cash for the future. Saving money will also help you make more money. You may have heard the expression, “It takes money to make money”. That advice holds true for everyone, even for those of us who are not millionaires or a savvy financial investors.
There are a few ways that saving your money will make you money. First, by keeping your money in a savings, checking, or money market account, you will earn interest on your balance each month. The amount you save depends on the interest rate on your account. This will not be a large source of income, but the interest you accumulate each month will add up and the more money you keep in your account, the more money you will earn in interest.
Second, you earn money when you save by avoiding emergency situations that force you to go into debt. Any time you have to buy something on credit, you are paying much more in the long run. If you are prepared with cash in savings, you can afford the unexpected problems that life throws at you without having to pay more by going into debt.
By saving your money and avoiding falling into debt, you will also build good credit. This will help you when you decide to apply for a mortgage or for a car loan. Having money in the bank will make you a better credit risk, and that will let you take out a loan at a much lower interest rate. These kind of savings may seem intangible at first, but a lower interest can easily save you thousands of dollars over the course of a long-term loan.
Saving your money now will help you become financially stable. You will be able to confidently make decisions about career changes, large purchases, or expanding your family. In addition to having a financial safety net, your savings will bring you a greater sense of freedom and control over your life.
Like flossing your teeth or wearing sunscreen, saving money is a basic part of life that will bring you great rewards and just might help avoid a future disaster.