Saving up has never been more important. Right now, our experience tells us that it is so hard to save up when everything else so expensive. But it might be helpful to think about the goals of why we are saving up. It should not be about concert tickets, though, because the motivation to save up for them may not be as strong as, say, your first apartment or a laptop. It doesn’t mean that you should not go to concerts, but it would be nice to be able to spend on something that is considered to be an investment for the future or to better the present.
For this reason, investments like bond mutual funds have become popular with people. The best thing about this is you do not need a lot of money to be able to start investing in it, in fact, if younger kids have saved up a significant amount from their allowance, they can start growing their money while they are in school. So now we are presented with a way to grow our savings, and all we need to do is start an investment account and allow the manager to handle it for us.
Sounds like a good plan, right? But before you start running to your bank or an investment firm, let us help you save up for your first investment first. Here are ways in which you can start saving, and hopefully, it will help you in other areas of your life as well.
Delay of gratification
You have probably done this without knowing it, especially when you are saving up for something that you really like. You tend to gravitate towards the cheaper brands of shampoo or soap, and sometimes you do not go out much so you can just stash your money away. But a delay of gratification is not just about foregoing things we normally enjoy so we do not spend much, and it just means self-control. For instance, you can limit your splurging to a fixed amount, once, every month, it is up to you what it would be.
Another scenario you want to avoid is using your credit card to buy an item now and pay for it later. Doing that is fine, that is what credit cards are for. But the best way to make sure you are not going to touch your savings because you cannot pay your bills with money on hand is to save up for the item first before charging it on the card.
Learn how to manage your own finances
The best thing to do when it comes to money is knowing at least the basics of financial literacy. It will help you when you are managing your finances. Allowing other people to handle it for you, like relatives and friends, might cause more trouble than you might think. In any case, you can always ask for professional help from a financial advisor to guide you when you are budgeting or when you are already starting your investment.
Allot money for emergencies
After paying the bills, try to put aside money as your emergency funds. It does not have to be a big amount because if you do it constantly, the money will grow. Having emergency funds, you can dip in will help you avoid withdrawing too much from your actual savings account.
These are basic ways to save up for an investment, or even for making purchases like cars or a house. You can also check PAMI’s Summer Shop or Go Promo to know more about some of the instant rewards you can get for investing today. Keep these things in mind, and you will get used to a habit of smart spending in no time.