Why Saving Should be an Important Part of Your Budget

by on June 7, 2018

Did you know that very few people actually make it a priority to save? Some may believe that it’s pointless to save money when there are so many things you can spend it on, others feel they don’t have the means to dedicate even a cent towards their future. Sure, you should be allowed to enjoy the fruits of your labor. It also goes without saying that with the cost of living being the way it is, that sometimes it can seem impossible to find even a dollar to save. As true as both of these statements are, failing to save money could leave you in a real pickle.

Consequences of Not Saving

Why is it important to save? Because life is uncertain. You can never be too sure when something may arise that you need money for. You may have a well-paying job, but there could come a time when that paycheck doesn’t cover your needs, or even worse, your paycheck simply stops. From $500 car repair or $100 increase on your utility bill to more drastic changes like a divorce or loss of employment, there are a lot of things in life that could leave your finances upside down.

Saving gives you a nest egg to turn to when things go wrong that you weren’t expecting. Failing to save essentially equates to failing to plan. The consequences can be ongoing:
• Unprepared for a financial emergency
• Unprepared for life events like weddings, buying a house, or college
• Having no choice but to borrow money
• Piling debt
• Emotional distress
• Poor credit
• Increased out of pocket costs (interest rates from credit cards or loans, late fees from unpaid bills, etc)
• Being forced to dip into assets (retirement loans, home equity loans, etc)

What You Can Do

If you haven’t made saving a priority in your budget, chances are some of these consequences listed above have already happened to you. If that’s the case, there are a few things you can start doing to turn things around:

Take Out a Loan – If you’re currently in a financial jam and you need funds right away, the quickest solution would be to borrow the money. If you’re concerned about your less than stellar credit history, there are lenders that will still help. Maxlend payroll advance loans, for example, are short-term installment loans for individuals with bad credit. There’s typically no credit check and minimal eligibility criteria. The major qualification is that the borrower has a reliable source of income. If approved, you can have funds as soon as the next business day to resolve your financial emergency.

Reevaluate Your Spending – For those who have avoided saving because they feel they simply can’t afford it, it’s time to reevaluate your spending. If you can learn to live within your means, there should be plenty of money for savings. Review your bills and determine where you can cut back. For example, winterizing your home can help reduce your energy bill while cutting your cable services gives you a few bucks to put into a savings account. Then, consider your spending habits. Do you eat out often, like to go out a lot, or make minor mistakes like going to out of network ATMs? Changing these habits can help you free up cash you didn’t know you had.

Reduce Your Debt – A large chunk of many household budgets go towards repaying a debt. This could be the mortgage, student loans, credit cards, medical bills, and more. Reducing these expenses would increase your ability to save. You might try refinancing loans, renegotiating a payment plan with medical bills, asking for a lower interest rate on your credit cards, and more.

Boost Your Income – For some individuals, even after eliminating all unnecessary spending, the ability to save is still impossible. If that’s you, it’s time to look for ways to boost your income. Fortunately, there are a lot of ideas that you can earn cash in your spare time. Become a freelance writer or editor, tutor students on your favorite subject, rideshare for Lyft or Uber, or cut grass in the neighborhood.

Saving should be a priority for everyone. As you can see, there are a lot of big and little things that could throw your budget off. Whether you feel that your money is better spent on things or you believe you can’t afford to save, the above-mentioned ideas should give you something to think about. Even if you have to start small, eventually, you’ll have a nest egg large enough to be able to handle whatever may arise – good or bad.

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