Now that it’s New Year already, we know that most of you want to start saving as your New Year’s resolution. It isn’t very surprising, is it? Most of us want to be financially stable. It’s our desire to be able to shop to our heart’s content, eat like there’s no tomorrow, and tour the world without worrying about running out of cash. To do this, we have to ensure that we put our money in the right place.
“If you would be wealthy, think of saving as well as getting.” – Benjamin Franklin
Here are the types of savings you should have to be financially secure.
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Savings
We all know about savings. It’s incredibly simple to do. You can save either manually or electronically. To save manually, you need to buy a piggy bank and drop some coins and money there whenever you have some. While this is the simplest way to save, it’s incredibly risky too. Why? You may ask. It’s because it’s very easy to break that piggy bank and get the money right away if you’re not good at having self-control. If you’re such a person, then we recommend that you use the second option.
You can opt to save using a bank account. Having a bank account is an effective way to save because your money is deposited in an account. Sometimes, you have to pay a maintaining balance, which is good in ensuring you practice discipline and self-control.
Having a savings bank account is essential because, in case of an emergency, you can withdraw from your savings.
“Save a part of your income and begin now, for the man with a surplus controls circumstances and the man without a surplus is controlled by circumstances.” – Henry Buckley.
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Insurances
Having a savings bank account is essential for you especially due to emergency situations, but keep in mind that it is only for short term. Your bank account will burn out if you ran out of money. What will happen after 30 years and you’re too weak to work further? Being financially stable doesn’t only cover the present in your life. You should also cater for your long-term stability. You can do that by getting an insurance policy.
While you’re working hard to earn money, you can place a portion of it to an insurance coverage. This passive money will work in turn to let your money grow. By the time of its maturity, you’ll be having enough money to sustain you post retirement. If in any case, something unfortunate happens to you, your immediate family will be covered by the policy.
“If a child, a spouse, a life partner, or a parent depends on you and your income, you need life insurance.” – Suze Orman
Investments
If you already have a bank savings plus insurance, then that is good for you. You’re already secure enough to be able to live without seeking help from others. But if you still wish to let your money grow and live a luxurious and comfortable life, then you need to acquire this last type of savings: investments.
If you ever dream of having a business someday, a real estate property, or travel around the world, then you need to start investing. An investment can help you multiply your money as many times as you want (depending on your risk fund). If you invest in the international stocks market, your earnings will be based on the inflation rate in the market. It’s quite risky, so you need to make your investment decisions wisely.
“How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.” – Robert G. Allen.
