Importance of Saving Money

What is the importance of saving money? We all have heard that saving extra money each month can be a smart move, but why? Why take to mind these extreme money saving techniques?

There are certainly enough people out there who spend every dime that they get and they seem to be doing fine.

We are raised to think that if you make $4,000 a month and have $4,000 worth of expenses then you are doing fine. If you get a raise to $4,500 a month than you have $500 worth of extra expenses each month you can afford to take on.

We are conditioned to go out and make as much money as humanly possible and once we do spend it all and enjoy the fruits of our labor. It may sound like a great way to live, but it carries a lot of risk with it.

Sure while the money is rolling in you can afford to do anything that you want, but what happens when it stops? What if you get fired or what if you have to pay some huge medical bill all of a sudden? This is where the importance of saving comes in.

If you have no money saved up and your fired you still need to pay your bills. The only way to do this is to start using your credit and ranking up that debt. This leads to more and more bills and in order to maintain the same lifestyle you have to make even more money when you do find another job to compensate for the added debt.

But if you had say $30,000 saved up and you lost your job you are actually doing ok. Here you have plenty of money to pay your bills and you will not have to stress out.

When you save money you are better prepared for emergencies and are better equipped to take advantage of more opportunities that may come your way. This is the importance of saving money.

Saving extra money is obviously important, but if you are already struggling to pay your bills it can seem like an impossible ideal. If this is you here are some extreme money saving techniques that can really help you put money aside for a rainy day and/or to pay down your debt.

The first step to saving extra money is to find out how much you actually need to save. Experts agree that you should have at least 6 months of reserves just in case you are out of work. But it can’t hurt to be more cautious and save up a year worth of reserves.

Just write your goal down on a sheet of paper and try to figure out exactly how much you need to save to be prepared for any situation.

Then use this calculator which takes into consideration inflation, interest, and monthly contributions to see how long it will take you to save up that money and create some sort of game plan.

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Now that you understand the importance of saving money you are going to have to see where your money is going. Make a list of all of your expenses to see what you are spending money on and where you can cut back.

If you are unsure where you are spending your money keep track of it for a month and then look to see what was an unnecessary expense.

When it comes to extreme money saving meals can be a big factor. Eating in can help you save money and can also be healthier then going to fast food restaurants. It is a win-win situation.

What happens when you buy a soda for $1.25 and you hand the lady $2? You get $.75 back, but what happens to that $.75? Well for me unless I have a coin jar it is going to somehow vanish into mid air.

Let’s face it coins are awkward and carrying a bunch of them around with you means that they will eventually wind up in the couch or lying on the street or in a take a penny leave a penny holder.

Nobody thinks about the importance of saving money when it comes to nickels and dimes because they are not worth very much. But believe me, they add up!

Keep a coin jar around the house and every time you get some coins remember to come back and stack it on the pile. After a few months you’ll find out just how much of your money vanishing this way.

Take a look at your bills and make sure that you are actually paying the lowest you can. Don’t pay a $19.99 annual fee for points on a credit card when other cards will give you points for free. If you really can save money on your car insurance by switching to Geico then do it!

Just make sure that you will still receive the same service or better after you switch. The importance of saving money is one thing, but don't downgrade to a worse plan just to save a couple of bucks a month.

Whenever you get coupons in the mail take a look at them and save the ones that give you a discount on things you were going to buy anyways. Don’t fall into the trap of spending more money just because you have coupons, but use them when they come your way to cut down your cost. This is one of the most common money saving techniques.

Cragslist and eBay make it easy to sell your old things. So take advantage of them and when you have extra items lying around the house start selling them online.

The best time to start your Christmas shopping is the day after Christmas. This is when the stores are stocked full of Christmas supplies and are trying to unload it.

In case you didn’t notice, the Library is free, Barns and Nobels is not. I don’t have anything against Barns and Nobels. In fact I love the store. But if you are looking for a good book to read your local Library will not burn a whole in your wallet.

I’ve been talking about the importance of saving money, but don’t just focus on saving extra money. Sometimes you can meet your goals by looking for extra ways of making money instead.

If you have some extra rooms and live by the college, rent it out to some college students. If you like writing stories look into publishing a book. Be a little creative here and you will find it is much easier to start saving money when you have more money coming in.

That is it for the importance of saving money and these saving extra money tips. Here are a couple other pages to check out