“Saving Money”

Thoughts on a Free Market Economy…
“Saving Money”
By Phyllis Hunsinger
September 1, 2019

How often do we as Americans think about saving money? How often do we encourage young people to develop the habit of saving money? Why do we need to save anyway? We save because we cannot predict the future. Saving money can help individuals become financially secure. The data below demonstrates most Americans are not saving money.

A recent survey by Bankrate.com revealed that millions of Americans are ill prepared for any type of financial disaster. The survey found that fewer than 25% of Americans have six months or more of savings. Having six months of savings is deemed the responsible way to prepare for most common emergencies. The survey also revealed 50 % have less than three months savings, and 27% have no savings at all.

According to a report in The Atlantic, nearly half of Americans would not be able to come up with $400 savings in an emergency. From the government to the individual, habits of spending money we do not have prevail. The result of this excessive consumption is staggering debt. Personal credit card debt, student loan debt, and mortgage debt rob an individual of their income and will impact their quality of life significantly. Low interest rates tempt the consumer to purchase beyond their ability to pay. Lower interest rates also discourage savings; the higher the interest rate, the more visible the rewards of saving. It is not very rewarding to save with interest rates below 1%.

These alarming statistics point to the significant need for financial education. People do not plan to fail, they fail to plan. Successful people establish goals and work toward those goals. In order to save money, it is important to recognize the difference between needs and wants. A need is something basic for your survival. A want is something desired to make your life more comfortable, impressive, or fun.
Dave Ramsey says people can easily save money when they develop healthy money habits and future needs become more important than your current wants.

Establishing financial goals and practicing delayed gratification to save money empowers an individual to take charge of their lives. Financial independence is possible and begins with saving money.

https://www.free-dom.co.us, Phyllis Hunsinger © 2013 All Rights Reserved

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