We all need to save money for the future. Although it’s fun to spend what we have, if we don’t save, how are we going to manage when unexpected bills come in, or we want to buy something important and don’t have the funds to do it?
Not only that, but in the larger picture what will happen in retirement? Will your 401(K) be enough, or will you need a top up? Could it be that your savings will help you to have a good life in retirement without the need to take on a part time job, for example?
No one knows what is around the corner, but by having a good amount of money saved up, you can meet the future head on and not be afraid of anything that comes your way. Here are some useful tips on saving for the future.
Since the future is a long term goal, the longer you spend saving, the more money you will have by the time you need it.
The sooner you get into the habit of saving money, the less likely you are to be tempted to spend what you have saved as the fact that the value is mounting will be enough to make you want to keep doing it. Plus, you won’t miss any of the money that you put to one side as you will have been doing it for so long. Looking at long term investments, therefore, can be useful.
You will need to do a lot of research, and ideally you will want to speak to a broker and perhaps engage one to work on your investments for you. There are pros and cons to investing which is why you should always be aware that although you can make good money over time, you can also lose money; only ever invest what you can afford to lose, just in case this happens.
When it works out, however (and the more research you do and the better the broker you engage), it can work out very well indeed. The money you invest can accumulate in an investment pot and when the time comes to retrieve it, you can. In the meantime, it can be left to work by itself.
Start A Business
Surely starting a business is an expensive endeavor and not a way to save money? Although it’s true that you will need to spend some money to start a business (not, however, as much as you might think in many cases, as this will depend on the kind of business you are starting), the rewards you can gain from it will far outweigh the costs as long as you think carefully and don’t rush into anything.
If you don’t have the finances to start right away but you do have a good business plan, you can apply for a loan. A business loan or a personal one likes the ones you can see on this page will help you to get started. You can either run your new business on the side, bringing in smaller amounts of money that can be added to your savings, or you can make it your full time job, paying yourself a salary (and ideally still putting money to one side). The choice is yours.
Eventually, you can sell the business for a lump sum, or you can simply step back and let someone else run it while still receiving some form of salary. Either way, by running a successful business you can secure a good future with enough money to do whatever you want to do.
Property is a great long term investment. Even if there is a recession and house prices fall, if you can hold on to the property for a number of years, you should still be able to make money from it. Buying a property will give you a number of options, depending on your financial situation and what you want from the process.
One option is to rent the property to tenants and use the monthly rental income to pay the mortgage and then anything extra you can put into savings. Another idea is to live in the property yourself (thus only paying one mortgage payment) and when it is time to retire you can sell it. By this time, you should have paid the mortgage off completely, or very close to it. Alternatively, you could remortgage the property. This can be a risky move, as you will be adding the debt to the mortgage and it could be a lot more expensive over time, but it will also give you a large amount of money should you need it.
Make Sure You Have A Savings Account
No matter what option you choose to save your money, having a savings account is a good idea. Even if you intend to use your investments as your future spending funds, you can still put any ‘spare’ money you come into or have left at the end of each month into a savings account. It will help to stop you from spending it, and could top up your savings quite nicely too.
It can be hard to put money into an account when there is not a lot in it to start with. A small amount of money in an account is more tempting than a large amount, but because you might think it won’t be missed if you spend it or skip saving for a month. However, if you don’t start small, you won’t have anything at all.
In order to boost your savings account and make it more tempting to keep using, you could hold a garage sale and sell your unwanted items. Put everything you make into the account and it will look much healthier. You’ll want to add to it rather than withdraw it. Or you could set up a monthly payment so that you automatically pay money into the savings account. If it’s an amount you won’t miss, the savings will grow without you even thinking about them.