The Importance of Saving
Many young adults have not considered how to become successful and strategic savers. In order to become successful at maintaining good financial security and learn to use money wisely young adults must start off by learning how to save first. Saving can affect many lives whether in the future or even in their present lives today.
Many young adults of this generation do not understand that the first step to becoming rich and financially successful is to save. Millennials need around 1.8 to 2.5 million dollars to maintain a standard of living in retirement and yet many millennials have not saved that much due to other financial issues that occur in their lives. One issue that can affect the lives of many Americans financially is inflation. During inflation, all prices, especially food and gas prices, increase dramatically, causing many adults to spend more money on necessities. Generally, the basics to being financially secure is having good credit, saving and investing.
One of the key things to financial security is maintaining a good credit score. Many adults today wish to have a good credit score, which is at last 750 or above, and yet have not attained it. An important factor to having a good credit score is to pay your bills on time. If you pay them on time your credit score goes up and your credit lines increase as well. In the past lives of many adults, their credit score and other financial situations had no importance to them because they felt no need to worry about it at such a young age. Consequently, in their present lives they began to regret the mistakes they made in the past which begins with saving money wisely in preparation for the future. To reach the goal of not only a good credit score, but financial security, young adults must start off with the basics of saving. Overall, for young adults to become better savers they need to become aware of how saving can affect their future.
It is important for young adults to save money when possible, however they may not know how to begin. First, young adults need to eliminate any urges they get to spend every penny they earn. Secondly, young adults should focus on only spending money on necessities instead of luxuries like, an expensive pair of tennis shoes. Then they will begin to value the money that they earn… Lastly, as stated before, young adults should become aware of how learning to save now can benefit their future financial lives. Ideally, adults need to save 10% of their income but worst case, 5%. On the other hand young adults do not save money based on percentage of income they receive, they save money based on how much they choose to save. Although some say that the median age to start saving is age 22, there is nothing wrong with starting off earlier for a kick start to greater financial wealth. Also, many young adults ignore the fact that time is key. Young adults prevent themselves from learning to save because once they start saving, they realize that how long it takes and give up. The one thing that young adults seem to struggle with is patience. One important concept for young adults to understand to help them overcome such a feeling is to know that becoming rich and successful comes with time. The amount of money you have save will also increase over time. All of these ideas will help young adults become better savers.
Saving can give you tremendous benefits in the future that you may not have realized in the past. Due to the great amount of information I have received in my present life, I now know how to save to prepare myself for the future. The new financial information that young adults receive in the present, like learning how to save, can help them reflect back onto their past to review mistakes and fix them for the future. Yet what young adults learn in the present may not benefit their future life unless they choose to take advantage and utilize the information they received to help themselves live a wealthy life that they had always dreamed of having as children. In the next five years to secure my retirement, I hope to have a good job and save at least 10% of my income to start off with and then increase to 15% as time goes. I will also pay my bills on time, manage my money wisely, and try to maintain good credit. By following this plan, I know I can live a debt free lifestyle with no past regrets and future mistakes. In the past I viewed money as a special reward to spend on toys, today I view money with much more value than to be spent on toys and candy, and in the future I know it will change again for the better of my financial life.