Saving money is very vital as it could be a lifesaver. Beyond being a lifesaver, it is one of the easiest ways that you could have peace of mind. When you do not have much money on you and you do not have savings you would always be way scared of emergencies. You would know that if anything goes out of line, you would suffer for it except you can get a loan to quickly take care of it. However, even if the loan comes through and you take care of it, it would remain a problem because the same way you could not discipline yourself to save, it would be very difficult to pay back the loan without feeling the impact on your finances. This article would discuss how saving money grow your finances and tips to save money better.
How saving money grows your finances
There are two aspects to savings and they both work together to save your finances. The first aspect of saving money is regularly keeping money with the bank or other financial institutions that allow you to save money with them. In most cases, they would be willing to add some interest to your savings, which should make what you would be getting back when you are collecting the money you have saved a bit more than the actual amount that you save. However, the major draw is that by saving money with the bank, you would find be rest assured that your money would be safe as long as you are banking with a reputable institution. You would also know that you could access the money in as little as 3 days. Even when you have specified a deadline to access the money, you could apply at any time to get your money back. Some financial institutions have rules that if you insist on collecting money before the savings run its term, you would lose the interest you would have gotten from it.
The second aspect of savings is that you can invest. Even though investing is more difficult and has a higher chance of you losing your money, it is also more beneficial and has a higher chance of making your few thousands to grow into millions over time. This is why you should not only invest but try to look for reliable platforms to invest it, while also trying to diversify your investments. If you decide to use half of your savings every 4 months to invest in a particular company, within 2 years, you would have invested in 6 companies. With such type of investment, you would be much safer because even if only 2 of those companies perform well, in 10 years, the money you would be getting would be much more than what you invested in the 6 companies and the money could continue to grow. Hence, investments are very important.
Tips to save money better
The tips that would help you to better save money are discussed subsequently.
Be deliberate about saving: Being deliberate about saving implies that you don’t try to save money after you have started spending the money. By the time you want to save the rest, you might not have anything left, you might even by now be looking for where to get more. Being deliberate means you first remove the money you want to save and keep it where you cannot access it. Then you assume the rest of the money was your exact earnings and plan with it, such that if possible you should have some change at the end of the month. The fact you have already saved does not mean you should plan to spend every last dime. You might find yourself getting stranded and either taking out your savings or borrowing money against the next month.
Save and invest: There is a difference between saving and investment, with both being very important. Be very deliberate about saving and investing.
Use the right platforms: Using the right platforms make it easier to save money. The right platform would help you in tracking and managing your expenses. Once you have your expenses under control, you would be able to spend within the amount you want to spend while saving the rest. An example of such platform is N26. You can read reviews about N26 to know how they can help you track your expenses and save money.
Read reviews: Whenever you want to save or invest, be sure to read reviews about the company you want to save or invest in. You would be able to get first-hand information from customers about the reputation o the organization you want to save or invest with and how much interest or saving you should be expecting to get.