Why Saving More Makes Sense for your Future

Stores everywhere give us a growing range of options for spending our money. This post takes a look at why saving more makes sense for your future. This post may contain affiliate links.

How Spending Makes us Feel

Our economy and society are depended on all of us regularly spending money. The more money we spend the better the economy does. So its no surprise that we have an abundance of ways both online and offline to spend our hard earned money. Its not just online ads and End cap advertising in your grocery store that is trying to get you to spend money. We like to buy new things, sometimes things we don’t even need. The satisfaction of bringing home something new is as old as commerce itself.

After we bring it home, if its not needed it usually gets placed in a closet. And there it sits, sometimes for years or more. What if you could take the cash you spent on the item you did not need and double it, multiple times over the course of decades? Sounds like a far away place? The future will arrive hopefully with you in it sooner than you think. How prepared you are for the future depends on you.

Financial Rewards of Saving More

Were going to find a more convincing way to make saving money desirable and something you’ll look forward to. Just picture it every month you go to work 40+ hours per week. At the end of the pay period you get and spend your paycheck. For an example lets say its June. How much of your pay have you saved in June? Lets say you were able to pay all of your bills and you managed to save 7%. How do you feel about this 7% savings?

Has the month of June been financially satisfying for you (are you happy with your paycheck and where its gotten you in relation to your work output for the month)? On to July, lets say in that July after receiving and spending your pay you were able to pay all of your bills and save 85% of your pay. Now how do you feel? What would happen if you accomplished this nearly every month of the year?

You will arrive in the future tomorrow and you will have what yesterdays you has managed to save. You will also have the skills your past self has spent time and money to learn as well as the vehicle and home that that your past self has acquired. Everything you will have tomorrow your past and current self has procured and maintained for your benefit. You live in the present soon to be tomorrow.

Reasons to Save

There are many other reasons for saving more from your paychecks. Inflation has already affected your finances and will most likely continue to do so. This is a big reason to save more as it will allow you to live better in the future (also consider relocating abroad while working with US clients and getting paid in US dollars).

You probably also have financial and life goals that your looking to fulfill in the future. You might want to buy a newer vehicle or own a home these things take time. Just another reason why saving more makes sense for your future.

Another excellent reason to save more is to create an emergency fund. You just never know what you might need at a moments notice. Of course most of the time you’ll be fine, but its for those not so rare moments that you’ll be happy you had ample savings. A major appliance could need fixing or perhaps you needed a new roof on your house or had a medical emergency.

Its always a good idea to have between six months to a year of money socked away in an emergency fund that pays a high rate of interest. The high rate of interest will impact inflation’s ability to reduce the principal amount you have saved.

Yet another reason to save more is perhaps that vacation you’ve been saving up for. or perhaps you’ve lived in a very poor town or village and have move away and are doing well financially. You might want to give back through donations or other means. There are just some many reasons saving more makes sense for your future!

Ways to Save More Money

While there are lots of ways to save money, lets take a look at how much of a percentage your willing to save each month from your income. Lets start with a monthly income savings of 50% or below.

This rate may be possible for you to maintain with out moving or downsizing your residence. The first step is to find out as a percentage from 1% – 50% what you want to save. Then once you’ve figured that part out you can turn to your trusty budget and see how much you’ve been spending over the last year on average per month.

If you replied what budget? That’s fine to. In that case we have a free budget planner worksheet that you can download. Our budget planner worksheet makes it easy to input budget categories and amounts for each month. At a glance you’ll be able to see what you’ve spent in the current month as well as what you’ve spent so far this year.

The nice thing about having a budget is that you can see exactly where you’ve spent your money in the past and what you can cut to save the percentage you want to save. So now you have the percentage that you want to save and you’ll know if you can do this with out downsizing your residence. If so that’s great news! you’ll just need to minimize spending in several smaller budget categories to meet your savings % each month.

Where to look for categories that you can shrink your spending? Let’s first look at entertainment and dining out. These are both nice to have not really necessary. Perhaps you could reduce them by 70 or 80 percent.

Next is automotive if you have a car there are multiple ways to save. If you’ve got car payments and your not within a year to two of paying it off you could consider selling the car. If you decide to do this you could purchasing a used car with the money you have so that you don’t have car loan payments. For multiple ways to save on gas see our post on gas saving strategies.

Another way to save is to wait on saving a certain percentage per year and put all your extra money into paying the car loan payment off as soon as possible. Then after your car is paid for you might have a few hundred dollars a month in car payment savings which can go towards your monthly savings percentage goals.

Saving between 50 – 90% of your monthly income is a great choice. This should give you a nice rate of savings over time. This is however one of harder strategies as it requires the most sacrifice. Usually there are a few budget categories that people spend the most on. One of these is housing. You might have a house with a big mortgage or a really nice apartment with high rent. In these cases it would make sense to downsize. That is unless your near the point of which you pay off your mortgage. Assuming that’s not the case you could downsize. You could try downsizing to a basic rental or perhaps a tiny house.

Another factor in spending less is the distance you travel from your job to where your living. If you can shrink this distance this will benefit you. If the distance to your work from your home is very small you could walk or bike to work. This can save you lots of money over time. If you also have a nearby grocery store awesome! You could then sell the car which is another category where people spend a lot on.

There is another way to save even more! Do you have a job that lets you work remotely? This will also work if you have clients you can do remote work for. If so then you can move. You could move to a state with a lower cost of living. Better yet you could move to another country with a much lower cost of living. If you decide to go this route and get paid in US dollars while spending in a foreign currency you have the potential to do much better!

If this is of interest to you, you could start looking at narrowing down to a list of affordable countries. Once you have those you could subscribe to blog posts and or podcasts of expat bloggers in the countries your interested in. While certainly a big move, living in another country could open new doors for you.

Summary

There are so many reasons why saving more makes sense for your future. Its best to keep in mind that the more you can save the better off your future self will be. The best way to get the savings you want is to find the savings percentage your comfortable with and start working it into your budget.

Getting a good idea of how much you want to save per month will help you know which budget categories you need to cut expenses on. In turn cutting expenses and sticking with your budget every month will make all the difference.

If you haven’t downloaded it already, our free budget planner worksheet can help you get a head start on putting together your budget.

If your interested in saving more than 50 percent of your paycheck you might be interested in taking a look at this website that gives you tools and strategies for becoming financially independent and retiring early.

We’re rooting for you and wish you the very best in your monthly savings endeavor! 😀