The Advantages of

Saving Money
By Robert Alan Stewart
Submitted On November 17, 2021

   

The ability to save for all the

things you need will put you in a
much better financial situation
in the long-term. It will mean
you pay less for whatever you
are buying and places you in a less stressful
situation. Mind you some borrowers just
don't care that they are in debt as long as
they are able to pay it back.
The crunch comes when there is a job loss
or some health issue arises and there is no
money in the kitty to pay the bills.

A person who has set up their finances

properly will factor in these types of
emergencies in making their financial plan.

Saving money is a no-brainer; here are the

five main reasons for not borrowing.

1 NO DEBT

Borrowing money for the things you need or

want puts you in debt. It means that you are
indebted to someone else. Sooner or later it
all has to be paid back along with the
interest. The debt is not going away until it
is paid off so there is no point in burying
your head in the sand if you are indebted to
your creditors. Creditors have every right to
expect repayment of their money whether
they are the bank or other lending institution
or a family member.

2 COST OF BORROWING

There is a cost attached to borrowing

money and that cost is interest which is
sometimes referred to as "Dead Money."
Paying interest on the stuff you buy on
credit adds to the cost of the item. The habit
of purchasing goods on credit adds up to a
massive amount over the course of your
lifetime. That interest money could have
been used to build a nest egg. Commercial
debt is the worst type of credit spending
because the item which has been bought on
credit loses its value as time goes by.
Another name for commercial debt is dumb
debt.

3 READY MONEY FOR EMERGENCIES

Emergencies crop up from time to time. The
car breaks down, the washing machine
needs repairing, you suffer a tooth ache and
need to go to the dentist, you need a new
pair of spectacles. There could be anyone
for a number of reasons for financial
emergency. If you have money set aside for
these then you can tend to these
emergencies without worrying about
whether you have the money to pay for
them. Every responsible person has an
emergency fund on hand to cushion them
against financial shocks which can occur
from time to time.

4 A NEST EGG FOR THE FUTURE

Saving money means you are able to build

up a nest egg for the future. If you are a
responsible person you will have a
retirement scheme of some kind where a
portion of your pay goes into the fund. In
New Zealand it is called Kiwisaver. I can not
stress enough how important it is to be
enrolled in Kiwisaver if you are from New
Zealand. The government incentives make
this scheme a no-brainer. Your country will
have its own scheme with it's benefits.