Learning how to save money and invest on a regular
basis is a great way to help both yourself and your family. Having
money available when you need it—to buy a house, help
a family member buy a car, or pay for a grandchild’s
education—requires planning ahead and making savings
a priority.
If it seems as if you’re struggling to pay bills every
week, saving can be pretty tough. Saving some of your paycheck
may not seem easy, but it can be done. Even a small amount
of savings every month can add up over time—and help
you feel more in control of your life. In fact, savings can
change your life for the better. Here are some examples:
- Save for emergencies such as a major
car repair, an unexpected medical procedure, or being laid
off from work. Many financial professionals recommend having
three to six months’ income set aside in an emergency
fund. That sounds like a lot, but with regular savings you’ll
be surprised how fast it adds up.
- Save for the peace of mind that comes
from knowing you have money to buy what you and your family
need without having to worry about getting or co-signing
for a loan or using a credit card.
- Save for something that’s important
to you and your family, such as a college education or
a house.
While both saving and investing are important pieces of your
future financial plans, there is a difference between the
two. When you “save” money, you put it into places
that offer little risk. However, little risk usually means
little interest. When you “invest” money, you
take on more risk—with the potential to earn more money
over the long haul.
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