Sure, living large is something that most, if not all of us, really long for regardless of whether you’re financially able to handle it or not.
From Instagram to Facebook, the glamorous lifestyle is all around us and it’s almost impossible to ignore it.
Even so, it’s important to plan and save for the latter part of our lives although it’s not an easy path to follow.
Wondering how you should go about this? Here’s how. There are many factors which should motivate you. For instance, how are you planning to enjoy your old age?
Saving for a car or home is fantastic. The problem is, once you’ve achieved that short-term goal, you’ll shift to another need. Chances are that it will take up quite a huge chunk of your cash.
Most wants need upgrading. Cars, for instance, are evolving so fast, with better models popping up in the market every now and then. Choosing to make the right decision of keeping your current vehicle however outdated it is may seem hard now, but you’ll realize the benefits later on.
As you embark on the frugal journey, choose to live a life within your means and always make the most of what you have. This not only does show financial maturity, but it saves you a whole lot of inconveniences too.
Also, the idea of letting the future worry about itself is a bit far-fetched. The following reasons are sure to convince you that saving for the future instead of upgrading your lifestyle is a smart move.
Table of Contents
1. Your Golden Years are Secure
Being young, or strong enough to move around and rely on yourself, has its good and bad sides. One of the plus sides is that you’ve got your whole life ahead of you.
Turning 18 is a dream come true to most young people. You get to leave home and stand on your own two feet — no more curfews and arguments with your old folks over petty stuff.
The downside is, you’ll have to work hard to support yourself and pay bills. We’re not talking just a few years of doing this. Most jobs need you to spend a better part of your life doing them.
Plan on setting aside some savings whenever you earn. Come to think of it; this might not be a disadvantage after all.
Think of it as an investment. You use your energy right now to secure a happy future for yourself and your family.
Every dollar you set aside will count in the long run. With compound interest, you’re sure to receive more money than what you invested. That should be a motivation.
Retirement comes with its fair share of changes. You won’t have to spend money on college fees for your kids. Trips to restaurants and the gym might not be necessary.
Many of the things you’re worrying about now won’t be a priority then. This way. you can always relax and make the most of every moment
2. You Put Your Health Into Consideration
Life is unpredictable. Today you’re healthy, tomorrow, well, you probably might not be. Having health insurance is a smart option.
No matter how young you might be, there are lifestyle factors that could make you sick.
What better way to be at your best than by having health insurance? Most people think about dental and eye prescriptions. There’s more to it than that. With each passing day, old age comes knocking on our door.
This means that our health gets more fragile. Our immune system won’t be as strong. Living a healthy life is nice, but it may not be all you need to live well in your Golden Years. Health insurance is. There are countless benefits of owning health insurance.
First, you worry less and enjoy your life more. In case of any illness, you know that you’re covered. Health insurance allows you to receive quality treatment. You spend less time worrying since you have more time with your loved ones.
Second, with the rise in medical costs, it’s only wise to have health insurance. Unfortunately, many people kick the bucket because of lack of funds to cover the medical expenses.
Others dent their finances with debts that can take months, if not years, to repay. Health insurance is more beneficial if you’re in a financial crisis.
Third, health insurance offers benefits. Some of them are day-care surgeries and vaccination costs coverage. Taking your time in having health insurance now means a more comfortable life for you in your old age.
3. You Slash Your Taxes
Taxes are one of those burdens that anyone working wishes they’d get rid of. When you decide to save for retirement in a retirement account like the Roth IRA, you’re on the right path.
Roth IRA is a special account that thrives on your post-tax income. That is, the cash you have to spend after sorting out matters with the state, federal and withholding taxes.
All the cash that you store in it is tax-free. The only catch is all your withdrawals have to be in line with the regulations of the account.
Unlike the traditional 401(k) and IRA, Roth IRA is an excellent choice for people of all ages. Here’s why.
Roth IRA is flexible
Thinking of how to keep your emergency fund flowing with cash despite regular withdrawals? Roth IRA is the solution to your problem. You can take out money from it at any time, without having to worry about penalties and taxes.
Plus, whether you want to withdraw money to buy a car or buy a home, you can do so with Roth IRA.
You as well as your following generations benefit from it
Roth IRA allows you to save for yourself. Plus, you can make your savings accessible to your future generations. There’s also no minimum withdrawals limit. Now that’s a win.
You can make contributions to it even when you’re 70 ½ and above
Plans like the traditional IRA, limit investors to age 70 ½. After which they should take minimum distributions and pay taxes for them.
With Roth IRA, you can contribute for as long as you live. What’s more, it’s got no minimum distributions.
4. Your Loved Ones are Taken Care Of
The best (and challenging) part of having a family is being able to take care of them. When you invest from a young age, you’re preparing a comfortable life for them when you won’t have the strength to.
Once you’re old, you’ll get all the time, and finances, to do whatever it is you fancy. Even if you’re way past 18, it’s never too late to start saving. If you’ve got a family, they stand to benefit also. You won’t have to live with your kids because you’re not financially stable.
Even if they don’t admit it, it will be quite a strain accommodating themselves and you. Having a cozy nest and a decent amount of savings when you’re old means that you’re secured and everyone is happy.
Sad as it may be, saving guarantees you a proper send-off when you die. Planning for a funeral is pretty costly. Your family won’t struggle to raise the necessary finances and incur debts in the process. The trauma of losing you will take a toll on them and straining their pockets is the last thing they’ll need.
5. You’ve Got all the Time You Need
Planning on retirement early gives you an advantage of seeing your money grow over the years. If you choose to invest in some projects along the way, it will obviously decrease. The good thing is that you can get it back, with interest.
Most young adults focus more on the now: college, their careers and the finer things of life. Their line of thought is reasonable, considering they’ve got all the time in the world. But hey, why not use this to your advantage?
If you consider yourself young, start saving now. You’ll be squirming in money before you know it and you’ll have lots stashed up for your kids and grandkids.
Other Benefits of Saving Early
Get the Most Out of Compound Interest
Let’s say you get into the saving idea when you’re 20. You start with a reasonable amount, say $100. If you earn an interest of 5% every year, by the end of the year you’ll have more than what you started with.
And that’s just in a single year. The next year will bring a double of what you got in the first year.
You’ve Got An Edge Over Your Agemates
Choosing to go against the tide now may seem hard. But, you’ll enjoy the benefits a couple of years in the future. You’ll be able to buy stuff that most of your peers can’t because they chose to upgrade their lifestyles and eat life with a big spoon.
Saving Disciplines You
No more impulse buying and wasting green on stuff you don’t need. Getting off on an early start enables you to budget for your cash.
You slash items that consume your money, hence keep most of it through saving.
6. You’re Protected
Thinking about your future is one thing, but working towards improving it is another. The best way to make your retirement saving dream a reality is by making a move.
Open a savings account if you have none at the moment. Get all the help you need if you’ve got no clue on how to open one.
No matter how much money you’re earning, there’s no telling what might happen in the future. You could lose your job or lose a limb.
If you’re relying on your current source of income, it’ll be a blow alright, but if you’ve got savings, congratulations. You’re safe.
Retirement isn’t a blow, but to most people, it’s that period when they sit back and relax. Here’s where having savings comes in. Borrowing loans or going after your kids for help is the last thing you need in your Golden Years.
If you made the wise decision to invest while still in your youth, you’ll have more than enough stashed up in your account to secure your future.
Whether you want to go golfing, travel to other countries or buy a car, you can do it all, plus more. The key is staying focused
Letting what you stand to gain in the future motivate you to cruise through the challenges now.
If you chose to protect yourself and your loved ones when you’re well into retirement, don’t lose hope. With the right accounts and plans, you too stand to enjoy a stress-free retirement.
Who knows? You can save much more than someone who started earlier.
7. You Become Richer With Time
Once you look at things from the bigger picture, you realize the importance of investing. Getting money and spending it on a very expensive lifestyle doesn’t add any long-term value to you.
It only helps you cater to short term needs like food. entertainment, and clothes.
When you decide to change your spending habits, you’re preparing a better future for yourself. Investing in a plan or putting your savings away is crucial.
It helps you add more value to your current financial status.
It doesn’t matter if what you’ve got to invest in your savings account is a dollar. As time progresses, you get to enjoy more returns.
Being stable and living a luxurious lifestyle doesn’t happen without some effort. Most people work to earn it.
Aside from putting your savings aside, you could come up with other ways to grow your income. Get an extra job, start your own business or sell stuff that you don’t need.
It can be tempting to squander the raise you get as a way of rewarding yourself. But, the best reward comes when you decide to get a hold of yourself.
Every time you make a higher earning or get more money, increase the rate at which you put in your savings.
Putting in money before you can even count it is a proven way to maximize your earnings. When you see a rise in your retirement savings, you get the motivation to keep saving, which is a good thing.
If you choose to continue working even after retirement, you’ll save even more.
8. You Enjoy a Life that’s Free of Debt
Living large, especially when you can’t afford it, is a reason why most people suffer financially. They heap one debt on top of the other, ruining their credit score in the process.
For the shopaholics, an exhausted credit card is a result.
Choosing to invest in your future helps you steer clear of any debt. You know where your money is going and work toward growing it.
You may come across several debts in your journey. Paying them off as soon as you can is a sure way of simplifying your journey towards a secure future.
If you’re stuck in a debt mess and wish to change things, or you want to avoid debt, here are some tips to give you a head start:
- Put yourself first. By this, I mean, have some cash that you can use in case of an emergency. This helps you to be self-reliant and have somewhere reliable to get some cash any time you need it.
- Have your cash at hand instead of relying on your credit card. Using a credit card encourages impulse buying. This puts a strain on your finances no matter how careful you may be.
Why not use the cash on hand then put it into your credit card? This helps you enjoy credit card benefits such as cash back on purchases and rewards.
- Don’t increase your budget because you’ve got more money. It’s easy to go nuts over cash, especially if you’ve been watching how you spend it. When you overspend, you’re a dollar away from debt. Counter this by putting any extra income into your account.
9. You’re Ready for all the Stages In Life
Needless to say, life is one long journey filled with twists and turns. Some of these twists and turns are great.
Others leave a nasty taste in the mouth. It also comes with loads of surprises and changes. Today you’re a kid, and tomorrow you’re old and frail watching the sunset from your porch.
The only way to be ready for any stage in life is to invest. It may not seem like such a big deal now. It may be satisfying for you to earn from your job and spend the cash.
Starting your own family or getting married may also not be a priority for you now.
And that’s fine. As the years swoosh by, you’ll realize that your priorities change. Every stage in life comes with priorities. And, each of these priorities needs finances.
What you had the least time for before will be your main center of focus now. Make the most of your working years to invest in those beautiful stages in life.
If you’re planning to tie the knot, the best buddy that you can ever have is stable finances. You won’t have to worry about hitches on the Big Day except for the normal ones.
That goes for having kids too. Bringing up little ones into this world needs time and enough cash.
Having a devil-may-care attitude can be costly in these times. Every stage will be a shock to you. As much as we’d all want to stay young, unfortunately, it’s not possible.
Living a comfortable life, however, is possible.
10. You’ll Become Financially Free
The main reason for getting a job is to make some cash. If you take this cash and save it, with time, you’ll become financially independent.
Doesn’t sound motivating enough? How about being able to do whatever you want whenever you want?
Yeah. Going to the office can be an option in a matter of years or less. You could be an entrepreneur, freelance writer or any other job that suits you.
Most people gain the power to control their finances at a young age.
Though saving is one of the ways to achieve this, it isn’t the only one. Delve deeper into your strengths and use them to increase your income.
This helps you to have some money to spend on daily needs while having more to put into your account.
Living a financially-free life has many pluses
For one, if you’ve got a family, you’ve got all the time to hang with them. You can also do stuff you like best but haven’t ever gotten the time to do, like pursuing a passion or hobby.
Second, working towards a brighter future doesn’t mean that you should be too hard on yourself.
Reward yourself as much as you can. Financial independence grants you this luxury. With lots of cash in your savings and a day job on the side, spoiling yourself will be a regular habit.
Third, not all the money has to go to rewards. You can choose to expand your business and invest in some venture.
Telling whether it’s legit or not isn’t always simple, but that’s where the thrill lies. Most times, such ventures end up reaping more returns.
Fourth, you get to set your own rules and break the retirement norm. While the usual retirement age is 65, latest 70, you can change things and retire at 40 or earlier.
The critical thing to remember here is not to get carried away. One big break shouldn’t get into your head.
Retirement requires plenty of cash to roll back on. If you’ve achieved stability, and are sure it can cover you for years, you’re free to take a permanent break away from work.
Now is the Time
You’ve probably not given much thought about your future. The current financial madness has had you spending every cent that you earn.
It doesn’t have to continue like this. From the reasons above, it’s clear that focusing on the bigger picture is more beneficial.
Don’t let your finances control you. Control them instead, for yours and your family’s welfare.
Relying on privileges such as savings may not offer a permanent solution to your future. The cost of living could get more expensive in the coming years.
The best way to gear up for the bumpy ride is to save for your future. It doesn’t matter how old you are. You’ve got the key to a prosperous future.
Start today. Start now. With determination and a source of income, nothing can stand in your way. Take a shot at it and you won’t regret it.