Ultimate Savings Guide

When do I need to start saving money?

Save! Save! Save!

So you probably could tell that I am really into savings. How much should you save? As much as you can! The more you can put in savings now the better. Remember; assume that you won’t be able to save more later on so do as much as you can.

 

When do I need to start saving money?

When do I need to start saving money?

As early and as young as possible

As early and as young as possible. That’s right- today. You need to start saving money today. No matter how old you are- teenager, college student, just returned from seminary- you need to start saving money now. In fact, if you have children you should encourage them to start saving now– especially if they get any cash as gifts from Bar or Bat Mitzvahs or other events. 

Ultimate Savings Guide

If you are single or living at home and you have minimal expenses- use this time to save. It may be depressing or hard to live at your parents’ house, but trust me! the amount you save can really help you later on. As you move on in life, get married, have kids, etc. the expenses go up and up. Having no student loans and having money put away for a house and retirement can really help you in the long run! Try as hard as you can to live on less and save more. Obviously, this doesn’t mean you shouldn’t enjoy your life! That is why we have a splurge account and a clothes account. You can spend money on yourself, you should live and travel and enjoy, but you should also save as much as you can. Challenge yourself to save as much as 50% (or more!) of your paycheck. This money will grow and grow and help you tremendously!

 

How do I start saving money?

How do I start saving money?

By saving $1,000 as your first goal

The first way to get motivated is to save $1,000 dollars. Having the first $1,000 saved will change your financial life. (Join the $1,000 Savings Challenge here!) $1,000 is not necessarily enough of cash savings to have but it is definitely the first step to having a good and secure financial future.

 

Why do I need to have money in the bank?

Why do I need to have money in the bank?

Life is unpredictable.

 

Life is unpredictable. Things can get crazy. The secure job you thought you have can be gone in a blink. That's why you need savings. Click To Tweet The no-risk investment or side hustle can be gone as well. Some people think that they can just cut expenses really drastically if they need to. However, this is neither practical nor easily doable. Moving is not really a quick fix, and besides moving expenses add up super quickly. Additionally, you may find yourself in a situation where cutting expenses is less than ideal. (Global pandemic anyone?). While cutting expenses is a really good idea when you can, you need to have a really good savings account as well.

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How much money should I save?

How much money should I save?

At least 6 months of living expenses.

 

I personally suggest having at least 6 months of living expenses in a high-yield savings account.

Calculate all your regular expenses, multiply by six, and then round to the nearest thousand. That’s your new savings goal. You should be regularly adding money to this account every time you can. While you are working, while you are paying off debt, while you are saving up for other things. Put money into your savings account. Keep in mind that as life changes your savings account number may go up or down. I would highly suggest not ever taking money out of this account to adjust for a lower lifestyle change but you should defiantly add money as life adds more and more expenses (think kids, old age, lifestyle inflation).

 

Remember: assume that the worst is ahead of you and plan accordingly. You cannot assume that the hard days are behind you and that your income will just go up or that your expenses will become more manageable. They might but there is a very large chance that something unexpected or bad may come up. You may be the outlier whose income just goes down. Or you may have challenges ahead of you that you can never have foreseen. Having a good savings account will buffer you against the hardships of life.

 

Why is saving money important?

 

 

Some people don’t fully understand how important money is to a good life. Perhaps they are young and have never experienced living without money, perhaps they have lived a life of privilege but this I can tell you: while money is not the goal of life, it’s really freaking hard to reach your goals without money.

 

I am not trying to extol the virtues of money or encourage you to think that everything is about money or that money is the end game. It’s not. There are plenty of very wealthy people who are extremely unhappy and lead terrible lives. Money is not the be-all and end-all. BUT money can help you. Money is the means to an end. Having money can put you in a position where you can live your fullest life, where you can help others, where you can actually make a difference.

 

Why do I need financial security?

 

 

Having a bit of financial security is like having a safety net. It allows you to live your life with less fear. It allows you to reach out and help someone else because you know there is something there to catch you. This is why it is so incredibly important to have a secure financial life. You don’t need to (and you absolutely should not) obsesses about money or make money the sole focus of your life. What you should do, however, is take the money that you have and work towards building security for you and your family. Once you have that security take that privilege and use it to help others and make the world a better place.

 

This brings us back to the first point: when you can you must save money. Save as much as you can. Make your money work for you. Allow yourself to live without something to create a better future. Making positive money choices to allow yourself to live a good life is the best use for money.

 

Now that I have you convinced, its time to start saving money!

How to save Money Fast!

How to Save Money on Living Expenses

 

 

2 thoughts on “Ultimate Savings Guide”

  1. Nice read!
    Something I’ve noticed with people that aren’t active savers or carry debt, is that they tend to spend more money. People I’ve talked to about this have mentioned that “they’re already screwed, so what difference does it make?”

    Once they finally see some light though, and begin to save, or make more, and see a progression in their financial situation their attitude quickly changes to “wow, this is awesome, now that I have money in the bank I don’t want to spend it!”

    The key is to catch the latter behavior before the prior sets in. From a young age, it’s important to set financial goals and plans. Don’t become a victim of your financial situation! Start saving today!

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