Saving money is important, and it should be encouraged from as young an age as possible. No matter whether you’re saving money you get on your birthday, pocket money or money from a job, you should be saving- this should be implemented as early on as it can be; otherwise it’s a very hard habit to get into.
There’s a multitude of good reasons to save money; you might want to save up for something expensive, such as a designer handbag, a new phone or a holiday. More practically, you might have a big bill coming up that you need to pay, or maybe you want to look at buying a house or a car. Saving is vital in all of these scenarios.
So why is it still so hard to save? Well, once our bills are out of the way and once we’ve spent our money on a few social events across the month, it seems to leave us with very little, and we’re reluctant to put that money away. This cycle repeats itself each month, and by the end of the year, you’ll find that you’ve saved… well, nothing!
A more successful way to go about saving is to set aside a realistic amount each month, and then stick to it, every month. In fact, you should always save 10% of your monthly income, no matter what. Now, 10% might not seem a lot, but if you’re making £1,500 a month, that’s £150 a month into savings- which by the end of the year adds up to £1,800 a month. Now that figure isn’t too shabby, is it?
This £1,800 a month will quickly double and then triple if you stick to saving 10% a month, every month. If you earn more than £1,500 a month, or if you choose to save more than 10% of your monthly income, you will obviously be saving even more than £1,800 a year, which is excellent. This money can go towards a mortgage, or, on a more serious note, retirement. Yes, it’s true, you get a pension when you retire, but a large number of people often complain that their pension simply isn’t enough to live in. To have some additional savings in the bank would be nice when you’re old and gray, wouldn’t it?
When setting up a savings account for your 10% (or more) try to opt for a savings account that a) doesn’t let you take money out of it whenever you like and b) has a good rate of interest so that your money will continue to multiply while sitting in the bank.