7 Reasons to Save

If you would be wealthy, think of saving as well as getting ~ Benjamin Franklin

 Did you start saving while you were very young? Do you still set aside an amount each month from your budget as savings? You should be saving like the rich and famous. There are 7 solid reasons why you should save:

 1. Good habit: The amount is not important, the habit is. When you can save, it means you are spending less than what you have earned. More likely than not, you do not incur unnecessary debt. You get what you need, but you think twice before getting something you want.

 2. Emergency fund: Life is unpredictable, especially when money is concerned. A nasty accident or an unexpected retrenchment can cause havoc in your financial affair. It is prudent to have a cash reserve to cover around three to six months’ living expenses. So, the first priority is to save for an emergency fund.

 3. Save for a big-ticket item: it is a good strategy to save enough to buy a big-ticket item in cash rather than using your credit card or getting a personal loan. You exercise self-control and avoid getting into debt and incur interest charges.

 4. Save for a down payment for a car: It is also a better way to save for a larger down payment for a new car. Your car loan will be smaller and you also pay for a smaller amount every month and your loan period is also shorter. The most important thing is that you will incur fewer interest charges.

 5. Save for a down payment on a house: A house is a big investment. It is necessary to get a housing loan to buy your dream home. It is also wise to save and pay more for an initial amount and borrow less.

 6. Accumulate an amount for investment: How do you invest? First, you have to save a substantial amount and then you invest according to your risk tolerance. It is not enough just to save because the amount that you have saved plus the interest you have earned is not even enough to cover inflation. Making a prudent investment is the way to conserve your purchasing power and build your wealth.

 7. The starting point of a care-free financial future: Your financial future starts with savings and ends with a financially independent retirement. Fortune starts with savings and it is the foundation of wealth building. This is also the secret of the rich and famous.

 A penny saved is a penny earned. ~ Benjamin Franklin

10 Effective Ways to Save Money

The time to save is now. When a dog gets a bone, he doesn't go out and make a down payment on a bigger bone. He buries the one he's got. ~Will Rogers

What are smart and effective ways to save money? I can think of the following:

1. Savings as an “expense” item in your budget: In your monthly budget treat savings as part of your total expenses so that you can leave it to your savings account. If you try to save whatever that is left over, there may be nothing left.

2. Balance from your monthly expenses: In addition to the monthly allocation for savings, you can save the difference between what you have budgeted (more) for spending and what you have actually spent (less).

3. Your annual bonus: Do you spend the full amount to buy what you want or do you save part of it? Bonus is not part of your usual income and the amount is not allocated to cover your monthly expenses, save it.

4. Your annual increment: What do you do with your annual increment? Do you spend more because you have more to spend? Why not save part of it?

5. Tax refund: Do you get a tax refund from your annual returns? This is an extra amount to save.

6. Pay off debts: Debt attracts interest and interest attracts more interest and you are paying interest for nothing. To keep your hard-earned money, settle all your debts as soon as possible.

7. Make extra income the easy way: One positive way to save extra money is to earn more by working part-time. What are your talents and what are you good at? Can you provide useful services and charge a fee?

8. Curb your wants: If you can discipline yourself, you can control overspending and avoid falling into the debt trap, you will save more money.

9. Trim your expenses: Look closely into your monthly spending and do away with unnecessary items such as entertainment.

10. Keep fit and avoid bad habits: Physical fitness is more than just for the sake of health. It is insurance against critical illnesses. Just imagine the huge amount you can save on medical expenses just by staying fit and healthy. The other issue which is relating to your health is smoking and drinking. By avoiding these bad habits you are not only saving your health but you control your purse strings as well.

Good health is not something we can buy. However, it can be an extremely valuable savings account. ~Anne Wilson Schaef

Make all you can, save all you can, give all you can. ~John Wesley

5 Benefits of Savings

The habit of saving is itself an education; it fosters every virtue, teaches self-denial, cultivates the sense of order, trains to forethought, and so broadens the mind. –Thomas T. Munger

Cultivating a habit to save from young is a virtue. The benefits derive from this wealth-building habit last a lifetime. The first rule is to pay yourself first. Put aside an amount and deposit into your savings account when you receive your paycheque. If you spend first and save what is left, most probably there will be nothing left to save. Here are the benefits when you save regularly:


1. The wonder of compound interest: Your initial deposit will attract interest. However, even without further deposit your original deposit plus the interest you have earned will attract even more interest. And it goes on. Imagine how much more interest you can earn when you save on a regular basis

2. Save to buy what you want: Instead of charging it to your credit card to buy what you want. You can hold on to it by saving up an amount to pay in cash and save on interest.

3. Save and invest: At first, you save and when you have saved enough you invest to increase your wealth.

4. An emergency fund: Save an amount to cover three to six months’ expenses and when you are unfortunate to lose your job you still can carry on your lifestyle until you get a new job.

5. Financial freedom and peace of mind: Life is less stressful when you know you have saved enough to meet unexpected events in life such as illnesses and accidents.


Let us reverse our way of spending money. Save and spend and not spend and pay even more later.