Creating wealth by aggressive investing in high-return products, and investment tools are alright but saving comes before you start your investment journey. In the race of side hustle, promotion, upskilling, and creating multiple sources of income, financial freedom starts with your savings.
While financial planning you must start with saving your money, maybe it doesn't sound cool but it is basic and essential. Saving is an important aspect when it comes to creating wealth and a financially secure future. Usually saving has been thought from a very young age in every household but in adulthood, we tend to forget to save money. So let's revise our childhood lesson and understand why it is so important to start saving money.
Stress-free Life - The accumulated amount of savings allows you to lead a stress-free life knowing that no more struggles if life takes a different route. You can do whatever you want without having second thoughts before spending.
Secured financial future- Saving helps to create a secured financial future, overcome unfavorable financial terms of life, and deal with financial commitments.
Easy short-term goal- Achieving short term goals gets easier when you have enough savings. Also getting something that you planned in the short term can be purchased easily.
Deal with emergency- Life is full of uncertainty and that's why people buy insurance but various emergencies in life aren't covered by insurance. Dealing with emergencies can be costly and you require easily accessible funds for that. Saving allows you to quickly deal with any case of emergency without asking your friends or taking a high-interest loan.
Permits calculated risk- Saving is not only good for the sake of saving, but it also allows you to take calculated risks with your money while investing. You can invest without worrying about short-term gains and returns, which eventually help to better financial strategy.
How to start
- Limit your credit card spending, as it may give a temporary sense of having money.
- Keep a monthly saving goals and keep that money aside as soon as you receive the income.
- Explore saving tools and put money there to get better returns while keeping savings liquid.
- Keep track of your expenses and stick to your budget.
- Keep savings with someone you trust such as your parents or partner, and don't keep access to yourself.
Saving is as important as anything else to build wealth and have a stable financial life. Savings provide safeguard to family and security in unfavorable times. Once you build a habit of saving, you will see changes in your financial well-being. Start saving and be specific about your saving goals.
Anushka Trivedi is a freelance financial content writer. She can be reached at anushkatrivedi.com