Start saving money now!
The hardest thing about saving is often the motivation to start. “Why do I need to save now? It’s something I can do later when I have time”. Have you heard someone say this before? If left for long enough it can become harder and harder to be motivated to start saving.
We can all do it!
A person in a normal job without a large pay-packet can still earn a substantial amount of money in a lifetime. 30 years of working in a $40,000 per year job adds up to $1,200,000. Of course no one could save all this money as it has to be used for the essentials of life as well – food, clothing and housing. You might be shocked to find out that if 10% of this wage was invested and received a 10% return also for 40 years of working life, you would have $1,947,407!!
A good start is to get into a habit of saving some of your income. How much you may ask? If every person managed to save at least 10% of their wage every week for their working life they would be well on the way to a comfortable life style.
Separate bank accounts
Have your money in three separate bank accounts –
1. Everyday living and Bills. Money you need to run yourself or a family. Weekly food bills, entertainment (movies, alcohol) or take away food treats.
Essential bills such as electricity, council rates, gas, insurance, car registration.
2. Savings – money that is put aside for the long term. This is money that is not to be touched expect in emergencies and should be put in a bank account that is quite separate to other accounts. A high interest rate online account is a good example.
3. Fun and entertainment – Of course here is the part that everybody likes. Once the everyday living, bills and savings are taken care of, you can relax and decide to spend some of the left over money on fun and entertainment. Life is too short – so you are allowed to also let loose in the knowledge that your bills and savings are already looked after.
Now do it!
All these accounts should have amounts deducted directly from your wages, especially the bills and savings accounts. Work out the amount you think you need for bills and whatever is left over goes into your everyday living account. This way it relieves the stress of remembering how much you need at bill time and you can concentrate on more productive thoughts such as where to spend some entertainment money you may have saved.
I hope this has helped and good luck!
On the top blog menu I have a tab for free calculators so you can try some figures for yourself.