Saving is one of the pillars of financial wellness. It enables you to set objectives and achieve them, whether it is to clear debt or build assets for retirement. But how does one actually save, especially when it feels like you don’t have any spare cash? Here are some answers and tips to get you going.
Let’s start with why saving is important.
Firstly, it gives you a buffer when unexpected expenses come your way, such as your car breaking down, or if you need to make an unplanned trip home because a family member is ill. When you have an emergency fund, you don’t need to go into debt to handle life’s surprises.
Secondly, saving makes it possible to buy things that you cannot afford as part of your normal cash flow. It might be a course you want to do, or a piece of furniture you need or a holiday with your family. Again, with savings in the bank, you don’t have to borrow to buy the things that will add value to your life.
The third big reason for saving is that it’s the start of building wealth. For instance, when you have saved enough for a deposit, you can buy a house. Paying for tuition fees can give you a qualification that opens better career opportunities. Or money growing in an investment account will help you retire without financial concerns.
Investing is done to build wealth. You can invest by putting money into a business or into an investment account or the stock exchange. You have the chance to make more money but the risk of losing money is also greater.
With a little bit of basic financial planning, you can start saving immediately:
Remember, every rand you don’t spend is a rand you can save. It might sound like a boring way to live, but it is certainly not boring to buy your own house or to go on a fantastic holiday without getting yourself into debt! Financial wellness is a goal worth pursuing and saving some of your money, instead of spending it all, is a sure way of achieving it.
Do you know how savings savvy you are? Take the Bayport quiz to help you uncover your spending and saving habits: https://www.bayportsa.com/information-centre/quiz/Go back