Putting money aside every month isn’t always easy for everyone, particularly during our current economic climate. With so many things to prioritize our money for, it can be difficult to find the discipline to set aside a portion of your paycheck. However, the benefits of consistently putting money away every month are well worth it. Here are five great reasons why you should put money away every month.
Retirement
Retirement planning is important, even though retirement may seem far away. The earlier you start putting your money away, the more likely it is that you will retire in comfort. No one wants to live out their golden years worrying about how they’re going to pay the rent or their basic necessities. Monthly contributions to something like a 401K or an IRA will build over time ensuring that you have a nice amount for a stable and secure retirement.
Stress Reduction
While money can’t buy you everything in life, the truth is that financial stress can be one of the worst kinds. Eliminating this stress from your life can make you a happier and more easygoing person overall. When you have children to look after, and bills to pay, it’s important that you have a safety net. By putting away money every month you can ensure you have a financial cushion to lean on.
Unforeseen Job Loss
If there’s one thing we learned from COVID it’s that many of us had a job one day and the next day we didn’t. The truth is there are all sorts of things that can happen that can lead to sudden job loss. Having an emergency fund set away means you have enough to cover your basic expenses until you find another job.
Medical Emergencies
Regardless of whether you have insurance or not, insurance doesn’t always cover everything. If you suddenly become ill or develop a disease, an emergency fund is there to ensure you’re well looked after. Rather than resorting to high interest loans or borrowing money from someone, an emergency fund offers peace of mind for you and your family.
Investments
When it comes to putting money away every month, time is your best friend. If you can manage to put away money every month with the goal of letting it grow, you could find a significant return on your investment. Compound interest allows your savings to grow significantly over time. Remember, the earlier you start saving the better, and the more opportunities you have for potential gains.
Even though putting money away every month might require some initial sacrifice, the long term benefits are well worth it. Start small and as your money grows you’ll think of yourself for your self-discipline later!