One of the major obstacles to saving money is, erm, wanting to spend it. It’s natural – we work damn hard for our cash – we want to reap some benefit. Many people don’t think that the rewards from saving money outweigh the instant gratification we get from saving it – I get it, I really do, especially with interest rates on savings accounts being as low as they are (hello, 1.2% on my ISA :|). So, let me explain the benefits of saving money:
Peace of mind
This is the biggest (and most unexpected) benefit of saving money for me personally. I sleep a lot better at night knowing that I have a buffer (however small it may be) in my bank account. Once upon a time, had my car failed its MOT, or the washing machine broke or something similar, I would have had to have scrimped and saved and maybe even use my overdraft to pay for it. Now, I can use my savings. I don’t lie in bed worrying about things like that. It’s not something that’s easy to explain to someone who is barely scraping by, but even just putting £10 a week away (or whatever you can afford – check out this post if you’re on a low income), it really help you mentally.
One massive benefit of saving money is that you can save money. Let me explain: say your fridge/freezer breaks and you have to replace it. If you have no money set aside you have 2 options:
- Buy a cheap replacement either new or used from somewhere like Gumtree. Sure, you may snag a great deal, but chances are you’ll have to take whatever’s there. You’ll need it quickly so won’t be in much of a position to either haggle or wait around for another offer. This cycle continues because your replacement fridge will probably not last that long. The old adage of getting what you pay for is, I’m afraid, pretty spot on.
- Buy a gorgeous all singing, all dancing fridge/freezer on credit. If you’re lucky, your mum will lend you the money, but chances are, you’ll be paying a tonne in interest. Even if you buy a cheap fridge on credit, you’ll have to pay some interest, and again, cheap fridges won’t last as long so you’ll be back to square one in a couple of weeks.
If, however, you had some money put aside, you could get a good quality fridge and pay in cash. Also, if you spot a great deal on fridge/freezers you could pick up a new one before your old one conks out and sell your old one on. Everybody wins!
You can also save money on smaller items – for example, a winter coat. These tend to be at their lowest price in Spring/Summer, because who wants a winter coat in June. Well, if you have a little bit of money put to one side, you can get a great quality (designer, if that’s your poison) coat for a fraction of the price. However, if your old coat fails you in November and you’ve got no savings, you’ll have to buy a lower quality product that has had it’s price bumped up by demand. Economics favours the organised!
Be more spontaneous
Ok, your best friend has broken up with her boyfriend, and they had a holiday booked together next month – a fortnight in Tenerife. She asks you if you want to go, but can you afford it at such short notice? Now imagine that you have some money in a savings account for a rainy day. Ok, I would never advocate using all your money on a holiday, but if you can do it without dipping into that emergency fund…wouldn’t that be nice?
Being able to take advantage of opportunities like that and them not having too much of a financial impact is a luxury few people can afford, but it’s such a good feeling. Even something as simple as a friend ringing up and saying they have a spare ticket to a gig or a festival [insert leisure activity of your choice] and you not having to check under the sofa cushions, is something that you can’t put a price on.
Ok, cards on the table: I have nothing saved for retirement, but as I’ve explained before, the whole culture of working in a crappy job and counting down the years until you can jack it all in and sit in your garden are kind of gone. I should start some sort of separate pension fund I suppose, but I’m concentrating on saving to buy and house and getting debt free first. Maybe I’ll become a millionaire in the mean time (I’m a big believer in the power of positive thinking).
Still, it’s a big thing (especially if you live in a country where you don’t get a state pension) to be able to support yourself in retirement and maintain a decent quality of life. If you genuinely hate your job but don’t see yourself leaving it, get those pennies saved, grab yourself a side hustle and get yourself retired by forty!
I hope I’ve managed to convince you savings sceptics out there that there are definitely benefits to saving money. It may seem like a long, slow slog, but it’ll be worth it in the end. If you’re unsure of where to start when it comes to saving money, go up to the saving money drop down menu somewhere above this post and find the category that you think you need the most help with. Hopefully, there’ll be a post there to give you some guidance. If you can’t find what you’re looking for, either send me an email here or go to my pinterest page for (literally) thousands of money saving ideas.