Think. Tank. Essay. Challenge
Starting to save at a young age is an amazing way to start your path to success. In order to become a better saver, you must first understand why . Why save there’s always going to be money out there? This was a constant thought that would always come to mind when thinking about money . As a young adult its normal to only think about the present and not at all about the future. However, after watching my older siblings plan their retirement and future as well as getting information about what I will need to do in the future, it opened my eyes to what I need to start doing now ! Leaming about how to keep my credit scores high and being at a low risk at all times, the advantages of saving your money, and investing; all helped me understand why young adults need to start saving. Knowing all this new information encourages me to save and gives me motivation in knowing that it will benefit me in the future.
Young adults can start by asking themselves this before purchasing something, “do I really need this?” in doing so you are putting yourself in a position where you have to think about what you are buying instead of impulse buying as many young adults do. Think about what is being purchased and what you could do with that money instead. I personally am guilty of buying Starbucks three times a week. Every week I’ve spent about $15 at Starbucks alone. Instead of going every week cut it down to once every two weeks. Cutting down more as you go. Replacing the Starbucks coffee drinks with coffee made at home. Which tastes the same and saves me $15 every week. Instead of using those $15 dollars you can put them into a savings account, saving them for future necessary uses. Making changes to bad habits but still compromising and gradually following them will keep it consistent and an on going positive saving decision. Save now and gain later, although it may seem difficult at the time remember you will thank yourself in the future. Make movie and shopping excursions rare. When going shopping give yourself a reasonable budget and look for the sales. When you see a $30 shirt know that for that single shirt you could buy 3-4 shirts instead. Rather than going out to the movies, spend the night in watching movies on TV or on Netflix. Getting the same effect of going out to watch a movie but instead you are saving money and in the comfort of your own home. I have a bad habit of constantly buying books, finishing them in 3-4 days and never reading them again. Instead of letting them gather dust on my book shelf many young adults like myself can go to their local library and rent out a book, movie, or game for free.
In order to retire I will need $2.5 million as time goes on this number will continue to increase for further generations. Inorder to secure the future of my retirement it is crucial to make a plan . My plan for the next 5 years is to right away begin to take 10% off of every pay check I receive. Continue to save in daily purchases . Create a back up plan that will be used in case of any unexpected occurrences that life may bring me. For example, car repairs, home repairs, or possible medical bills. Having three to six months of my total expenses set aside will help me get through those unexpected hardships that are bound to happen. I plan on saving $450 a month for 40 years with a 10% rate of return in order to better ensure my future retirement. Making sure to watch my credit score, to pay my bills on time and to continue to stay in control of where my money goes and stays.
“The importance of money flows from it being a link between the present and the future” by John Maynard Keynes. Starting at my present years saving as much as I can then gradually move into the future with what I have saved. By saving you are creating an easier and more successful life for yourself in the future.