How to learn how to save money correctly?
It’s no secret that investments are a very good source of income. Well, of course, for those who know how to invest correctly!
How to learn to invest financial resources correctly? Answering this question, one could write a whole book, because investing is a whole science and in order to achieve good results, you need to thoroughly study all its subtleties. Within the framework of this article, it is impossible, unfortunately, to tell about everything. But the very first thing a novice investor should learn is how to save money. After all, in order to invest your finances in one or another profitable project, you must first take this money somewhere!
Our salaries are such that many hardly have enough to pay for utilities and food, to say nothing of some kind of accumulation of money there. At first glance, it may seem that there is nothing to postpone. However, fortunately, this is not the case!
10 percent rule
If you stick to the simple 10 percent rule, then even with the most modest income, you can save a little money that can be invested profitably in the future! It’s simple: try to save 10% from any of your income, whether it be a salary, a bonus, a scholarship or a small amount that you “bombed" on your car last night. Practice shows that 10% will not be a painful loss, you will be able to lead a normal life, and at the same time, you will accumulate a decent amount of money over a certain period of time.
In order to accustom yourself to discipline (and it will not interfere with the future investor), make it a rule to save these 10% regularly, without any exceptions, because financial illiteracy and lack of discipline is one of the main causes of people’s poverty.
Here is an example of how to learn how to save money with a small salary :
With a salary of 25,000 🪙, save 2,500 🪙 every month and in 5 years you will have 150,000 🪙. And if you save this money not “under the mattress”, but to the bank, for example, at 7.5% per annum with interest capitalization, then the amount of savings will already be 182,416 🪙.
Always set a goal
Remember that it is much easier to save money when you know exactly where the money saved will go. That is, you need to clearly see the goal in front of you. If you have not yet decided on an investment project, then “practice” in saving money for a major purchase or a tourist trip, so you combine business with pleasure. In addition, the accumulated funds can greatly help you out in case of unforeseen situations, which will allow you not to get into a debt hole.
If the goal is not important to you, then most likely you won’t be able to achieve anything, since one day all the savings will simply be spent on some “necessary” thing here and now.
While you are saving money in order to invest this amount in a particular investment project in the future, do not waste time, read books and publications about the right investment technologies, improve your financial literacy – this knowledge will be very useful to you in the future! Do not neglect the search for information on the Web – there you can find many useful resources on the topic of investing.