There is always something you need to spend your money on but putting a little away every month to help towards future expenses is a fantastic long-term financial strategy. Here are 5 future expenses worth saving for.
Putting enough money away to make sure you could survive in an emergency such as losing your job or getting sick is the most important thing you can save for. There is no point in looking after the distant future if you haven’t taken care of the here and now first. Aim to save 3-6 months’ worth of salary in an easy access account before you consider your longer-term savings strategy.
Putting away savings for mid-term luxuries will mean that you don’t have to get into debt or run up expensive credit card bills for things you know you want in the future. This will mean that you have enough money to save for your longer-term future as well, as you won’t need to spend money paying interest on the money you have borrowed. This article offers excellent advice on how to put extra money to work so that you can afford to pay for the things you want, such as a new car or a luxury holiday in the medium term.
Buying A Home
Many people dream of owning their own home but to make this a reality, you will have to save enough money for a deposit and be solvent enough to be given a mortgage. Saving for this can take a while but the more money you can put towards a house purchase, the less money you will have to pay to your mortgage company every month.
If you are planning to have kids in the future, it is never too early to start putting money away, so you have it to spare when the time comes. Kids can be expensive. You may decide you would like to give up work to take care of them while they are little or perhaps work part-time. Having savings will give you the option to do this. A college education is a huge expense so the sooner you can start saving into a college fund the better.
Retirement may seem like a long way off now, but it will arrive sooner than you think. This is the biggest holiday you will ever take as you could be off work and enjoying yourself for around thirty years. This will cost a lot of money, so saving as soon as you are earning money is a good long-term strategy. That way, you can retire when you want to, and you won’t have to worry about how you are going to pay for it. If you do not know how to prepare for retirement, seriously consider working with a tax advisor.
Proper planning is the key to making sure that you have enough money for the expenses that will arise at key stages of your life. It is worth planning for these future expenses, so you do not leave yourself short when the time comes.