Savings plan Photo by Michael Longmire on Unsplash

10 reasons to have a savings plan!

Savings plan Photo by Michael Longmire on Unsplash

What is a savings plan?  

A savings plan doesn’t have to be complicated. It can be as simple as putting a regular amount of money aside each month to reach a financial goal. A savings plan can also be setting yourself a challenge over a period of time. Your goals might be long term, like saving for retirement, or short term, like saving for a trip.

What does saving money mean to you? 

This blog is full of ideas for reducing spending in order to allow savings to be made.  I have my reasons for making savings, but what are yours?  If you don’t have any yet, here are ten good reasons why you should start making savings now:

If you don’t have any yet, here are ten good reasons why you should start making savings now:

1. It allows you to follow your dreams. Maybe your dream is to climb a mountain or start up your own business? Making regular savings over a period of time will support you in achieving these goals.

2. It can give you choices. For example; you could choose private schools or hospitals should you be in a situation where you feel that is necessary.

3. It means you are living within your means. By consistently under spending against your income, you will not get into a situation where you have unmanageable debts.

4. Savings can buy you time. If you want to take a career break or reconsider the direction you are going in savings can support that.

5. It can encourage you to think for yourself more. Rather than buying things every time a need arises, take time to think of alternatives to spending money.  

6. It acts as a safety net in case of emergency. If your source of income dries up e.g redundancy, you can fall back on your savings for a time.

7. You don’t have to rely on others. It may allow you to move out of your parents house. This could allow you to travel to places you are interested in but your partner might not be.

8. It can lead to financial freedom. Paying off your debts such as student loans or mortgages can be very liberating. By making savings you may find these debts can be paid off earlier than they need to be.

9. It can even out your cash flow. Save a little each month for yearly expenditure. That way when large bills which come in during the year, they won’t affect your cash flow.

10. Savings can support you in your retirement. Having savings in the bank / in a pension scheme will give you an enjoyable retirement. This means you won’t have to keep working into older age.

I think it is really important to try and save a little regardless of your income and try and live off less than you earn. Those savings give you the freedom to make choices and follow your dreams, plus you might sleep better at night knowing they are there!

Comments

  1. A good reminder to focus not just on the saving money but the end-goal: what saving money allows you to do!

  2. Zoe

    Thanks! I think it is so important to have a good reason for making savings as it makes it all worthwhile!

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