When it comes to saving money, we all know that we should be doing it, but for some reason we don’t. Or, we think that we can’t save money. Regardless of how you are living, there is always room for saving. It may not be much of a savings, but something is better than nothing.
Today, I’m sharing 11 major ways that saving money can impact your life for the better. I challenge you to start saving today! Making positive changes starts with now. No longer worry about the past and what you’ve been through. Transfer $5 to your savings account right now! Then, continue reading and learn why saving money should be a consistent habit in your life.
Saving money can help ease the burden of financial hardships.
One of the most significant ways saving money can impact your life for the better is that it can help ease the burden of financial hardships. Financial hardships come in many shapes and sizes, from your car needing new tires to you losing your job.
Having a cushion in place for such hardships can ease the financial burden that you will have to go through.
It’s extremely important to have savings handy to help with such hardships. If you don’t have anything in place to help when something unexpected comes up, you could resort to using credit cards. This will cause you to spend much more, thanks to the high interest rates.
If your credit isn’t good, or you don’t have any credit available to use, you may resort to payday loans or other high-interest alternatives. Having a savings in place will allow you to keep more money in your pocket, in the long run.
Saving money can help you get out of debt.
Debt is draining. Whether it’s in the form of credit cards or student loans, you feel the weight of that debt on your shoulders. Like I mentioned earlier, without an emergency savings in place, you run the risk of taking on more debt.
If you keep paying for your financial hardships with debt, you are prolonging those debts being paid off. If you are in a position to start aggressively paying off your debts, be sure you have a small cash reserve of $500 to $1000 handy in a savings account.
Only use this reserve in case of financial emergencies. Make sure that you have a solid budget in place as well. You wouldn’t want to tap into your reserve because you failed to follow your budget.
Saving money can help you own a home.
Guess what? You can’t get a home without some form of down payment. If your down payment is small, you may even be required to show reserves in the form of liquid assets. Without savings in place, you won’t be able to do either.
There are also fees associated with purchasing a home. If you don’t want to roll these fees into the loan (you definitely don’t want to, that just adds to your debt), then you need a savings in place to cover these costs.
The price of owning a home is going up in this country, regardless of where you are. Of course, some places are costlier than others, but we all need a savings to obtain the American dream.
Start putting something away for your future home. You don’t want to procrastinate this. When you’re ready for homeownership, having a savings in place will make your life much easier.
Saving money can help you prepare for retirement.
The average life expectancy is rising in this country. That means people are living longer, and therefore need more money to live on during retirement.
If you are not putting anything away for retirement right now, how do you expect to live when it is time to retire? Do you want to be forced to continue working well into your seventies because you didn’t take the opportunity to start saving for retirement?
The great thing about saving for retirement is that it can be made easy for you than a general savings. Most companies offer 401k plans and they contribute to those plans on behalf of their employees. That’s essentially free money!
Take the time to learn about your company’s 401(k) options. If your company doesn’t offer retirement plans, open an IRA. You don’t need an employer to save for retirement. Read 8 Things to Know About Your 401(k) Plan for guidance on what to ask about.
Saving money can help you buy a car.
If you live in a city like Manhattan where you can use public transportation for getting around, great! But, what happens if your job transfers you to Texas or someplace where public transportation isn’t as handy?
You will need a car! Uber and Lyft are great short-term options, but they can add up in the long run. Unless you get an excellent deal, leasing may not be the best option either.
That savings for emergencies and financial burdens can certainly come in handy right now. Whether you are saving for a car, or you unexpectedly need one, a savings will make it possible!
If you have good credit, you don’t need a down payment to purchase a car. This could result in a higher monthly payment, but a good savings in place can help you cover the costs until you get a new budget made.
Saving money can give you the freedom to do what you want.
No one wants to be told they can’t do something. More importantly, no one wants to feel like they can’t do something because of a lack of funds.
If your friends are taking a vacation and invite you to come along, you don’t want your situation to stop you from going. Having savings in place can give you the freedom to do what you want, when you want.
If you want to buy a designer bag and you’ve saved up for it, you can buy it without any form of guilt. In fact, you can feel proud that you did it the right way!
If you want to take a luxury vacation, you don’t want to put it on a credit card and deal with it when you get back. If you have savings, you can take that vacation and feel amazing while you’re there and when you get back!
The freedom to do what you want, when you want, isn’t something most of us are entitled to. We have to save for it, and that’s perfectly fine!
Saving money can open doors for you.
Unfortunately, we live in a capitalist society. You need money to live, you need money to eat, and you need money to do things that others can’t.
There are many more perks and opportunities available for people with money. Things that the poor and middle class may not even know about. Saving money can open those doors for you.
Even if having perks and opportunities isn’t the reason behind you saving money, it can impact your life. As you save more money and do more things, these perks and opportunities will make themselves known and they can help you save money on things that you may have spent money on.
Saving money can help you help others.
Imagine if someone gave you $10,000 right now. They had so much money saved that they had the ability to give you that much money and not even worry about it.
The ability to do that is powerful. How good would you feel helping someone in need, by donating to a cause that you believe in, or making a difference in a friend’s life?
Having a significant savings in place, and living a life you can afford will allow you to help others. Helping others, people you know or don’t know, is what life is all about.
Saving money can help you give your children a better life.
Don’t you want your children to have a better upbringing than you had? Even if you had a good childhood, wouldn’t you want your kids to have the same? Having savings in place before, during and after your child is born and grown up can help you and them.
One of the best ways a parent can help their child is saving for their college tuition as early as possible. Open a 529 savings account when they are born and start contributing a little to it every month.
Student loans have become the norm, but it can be so hard for people to pay them off, especially if they don’t have a high-paying job like they expected.
By saving for your children’s tuition early, you can give them a start that most kids don’t have. You can set them up for financial success! What an impact!
Saving money can help you become financially independent.
It’s great to be able to ask your parents for help when they can oblige, but what if you never even had to ask? Saving money contributes tremendously to your financial independence. You don’t have to ask anyone for anything. If you need something, you can get it yourself.
Financial independence allows you to live the life you want, and handle financial setbacks with grace. Your savings, that keeps growing and growing, breaks you out of the paycheck to paycheck lifestyle and leaves you with the freedom to become financially independent!
Saving money allows you to have more fun.
What’s life without a little fun? You should be rewarded for all of your hard work and sacrifice, and with a savings in place, you can be! You can treat yourself to something nice or a fun experience that will be a memory to treasure.
You can do all of that without guilt. Sure, you can have a little fun now and just pay for it on your credit card, but that holds you down. That keeps you on a lower level.
Related: 6 Easy Ways to Get Started with Saving Money
Are you good with saving money? If so, how has it impacted your life for the better? If you are not so good with saving money, what is holding you back? I’d love to hear what works and what doesn’t, and use that information to help!
2 thoughts on “11 Ways Saving Money Can Impact Your Life”
I really enjoyed writing this article. We all know that having reserves can make a difference, but sometimes reading about exactly how that difference can affect us is motivating!
I LOVE the freedom I attain for myself by saving money. I realize I have the power to make my own decisions and be in control of my life…and that feeling is absolutely priceless. I remember starting out my savings journey by scheduling automatic transfers for $25 to my savings account every month. That was my small, but powerful way of telling myself: Your future is important. Invest the time to do what will create a better future for yourself!