For many people, spending money is more exciting than saving. Even if this is your belief, it doesn’t mean you should spend every less dime without ever putting any money in the bank.
There are many reasons why people neglect to save, with this being one of the biggest culprits: they don’t know what they are saving for.
Here are five things you should be saving for:
1. Retirement. At some point you will want to hang up your work boots and enjoy life in retirement. This is a dream you share with many others, however, you are never going to reach the end result unless you start saving now.
Don’t become one of those people who reach retirement age with no money in the bank.
2. An emergency. Do you have an emergency fund? If your answer is no, there is no better time than now to start building one. Even if you have been relatively lucky in the past, never running into any emergencies, there is no way of knowing what the future holds.
There is no hard and fast rule on how much money you should have in an emergency fund, but many believe that at least six months of living expenses is ideal.
3. Your child’s education. If you have one or more child, saving money for their college education is something you don’t want to overlook. The cost of college is on the rise, so you shouldn’t put this off another day.
You may not be able to save 100 percent of what your child will need for his or her education, but you should do your best.
4. A home. If you already own a home, this one may not be applicable to you (unless you know you want to move again in the future). Those who are renting or living with somebody else, such as their parents, should realize that saving for a home can be both fun and challenging.
There is a lot that goes into saving enough for a down payment, but once you have the money you will look back and realize that it was well worth it. There is nothing more enjoyable than home ownership.
5. Something fun, such as a vacation or your dream car. There is nothing wrong with saving money for something you consider to be fun. Do you want to take a trip to Hawaii? Have you been dreaming for many years about purchasing a sports car? Know how much money you need, set a goal, and start saving.
Are you already saving for all five of the things detailed above? If so, you are on the right track to reaching many of your financial goals. If you have been holding back for some reason, don’t delay any longer.
When you begin to save for these things, you will feel better about your current financial situation as well as what the future holds. Nobody is making you save money, but deep down inside you should realize the benefits of doing so.