Thoughts about saving

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I want to write about savings. Why is it good to have savings? And why is it good to save money at all? I don’t want to publish a very long post so here comes some my thoughts.

Why save?

To start with, let’s check the reasons why you should save. The main benefits that I can see are that with a savings fund are that you can deal with surprises like when your car breaks down or washing machine crashes etc. Also when you have savings it gives you a sense of security.

How to save?

There are many ways to save. And many of those ways you can implement into your life without major disturbance of your normal way of living. Here are some basic things I’ve learned.

10% rule. A great rule that is very effective. Every month when you get your paycheck you put aside 10%. It may be a little tough at the beginning but on the other hand it’s great to see your fund grow and also your sense of security grow along with it. It’s really not a big difference to live of 90% or 100% of your income.

Make emergency fund. With the 10% rule it’s good to start building up your emergency fund. This is the fund that is going to cover all the minor economic surprises in your life. How big should this fund be? Good thumb rule is to have this fund about the same amount of three months of income of your household.

Set budgets. Take a look at your life. What is it that you enjoy? How do you spend your time? Traveling? Working on your home? Having fun? Create categories of funds and set a budget goal for them. For example a traveling fund or a home fund etc. Set a budget at the very beginning of each month.

Keep account of your household. This is the only way to really know where your money is going.

Cook at home. This is a good rule both for your wallet and your health. When you cook at home you know exactly what is going into your meal. And of course it’s cheaper.

Use the library. What a brilliant invention libraries are! All the books you could ever need to read. There you will find all the latest books and also rare books. No wonder libraries have lived for so long. Of course there are some books I like to own, mainly because I like to read them more then once. Here is an example of the books I own and recommend.

These are just some of my thoughts about saving, more will come soon. Hope this helps.