Please stop working to pay everyone else.
By everything else I mean groceries, cable, the bar down the road.
Do yourself a favour and pay your future self FIRST! You’ve worked hard for your salary, why not save first before spending: even if it’s small, decide on a number and begin (10%, 5% or 20%).
I know what you are thinking: Charielle, I could barely make ends meet where am I finding money to save?!
The thing is, everyone has to start somewhere and like anything else, you have to practice in order to improve and turn something into a habit. Trust me, saving money is worth the effort and is very rewarding. No matter how small please do yourself a favour and JUST DO IT; start.
Why?
You feel empowered and independent. Having a savings gives you peace of mind. Let’s face it, financial troubles can keep you up at night with worry and really diminish your self esteem. However, by accumulating savings, these worries vanish because you’ll always have a cash reserve to tap into. (Just remember to fill it back up for the next rainy day).
Consider the alternatives: you can tap into the international monetary fund of Mommy and Daddy or a consumer loan with an interest rate that will keep you trapped for a while. Or maybe borrowing from your friend who will blast you on Facebook the moment you miss a payment.
Mastering your finances and savings gives you confidence and freedom.
The more you save, the easier it becomes to build additional savings. Investing is transforming your savings into wealth so when you’ve saved a sufficient amount of money, you can take part proceeds and invest in stocks, bonds or a mutual fund that will pay you dividends or interest.
The alternative is leaving your savings in the bank where your funds are eroded by inflation. Inflation often rises higher than the interest rates so having it parked there for too long will begin to lose it’s value. You worked hard for your money now put it to work for you.
Lastly, a savings means you’ll be prepared and ready for retirement. Picture this: all bills staying the same or perhaps increasing as you are home more but salary being cut drastically! The horror right?
Well sweetpea, that’s retirement. If you save and plan for retirement today, trust and believe you will be ready to retire sooner than you think. However, if you do not you will be forced to work much longer than you anticipated, trying to play catch up. I don’t know about you, but me, at age 65, I can hardly wait to say ‘BYE WORKING WORLD; HELLO REST OF THE WORLD’.
Now we have the facts, here’s how to do it
Decide on a percentage to put away. 10% to 20% of your income is a reasonable portion. Set up a standing order or salary deductions into saving instruments to be withdrawn on payday. Good places are credit unions, banks, unit trust, some mutual funds and sou sous (with people you can trust).
Save unexpected money like bonuses and tax returns.
Do your due diligence. Shop around before making big purchases or taking loans or wait for sales like Black Friday or end-of-month sales to make purchases.
It will save you money in the long run.
Charielle Plowden (BSc Hons) is a financial professional currently pursuing International Wealth and Investment Management and holds a Financial Advisor certificate with the Institute of Banking and Finance. She’s worked in the financial services sector for the past four years, is a registered advisor with TTSEC, and currently sits on the board for Nestle Credit Union. Follow her on Instagram and LinkedIn.