Savings are powerful things. They ensure that you've always got a safety blanket in place when you need it and stop worrying too much about cash when you should focus on your studies. Unfortunately, a lot of students end up ignoring their savings, assuming that they can always come back and top up their emergency funds at a later date.
After all, when you're still young, you want to spend your money on partying and enjoying your time with friends. Planning and budgeting for your future isn't nearly as exciting. Today we're here to show you why fighting the urge to splurge is such a good idea when you're still young.
1. It Gives You Something to Fall Back On
As a student, you'll never be totally sure what's going to happen from one day to the next. While studying, you might fall asleep with your phone turned on and end up going over your internet limit. Then, a month later, when you receive your bill in the mail, you're left wondering how you're going to afford all that extra expenses. Having a savings account in place means that when things do wrong, you do not have to panic and sell everything that you own. This gives you some much-needed peace of mind.
2. It Protects Your Credit
Having savings that you can tap into now when you need some extra money also means that you are less likely to have to turn to things like loans and credit when you are running low on cash. You won't have to worry about damaging your credit history or putting yourself in too much debt at an early age. The more you can show that you are careful with your money when you are young, the easier it will be to get lending opportunities later.
3. Enjoy Compounding Interest
The earlier you start saving for your future, the more time you have to take advantage of compounding interest. That basically means you earn more and more cash from your money over time. The longer you leave your cash to grow, the more chance you'll have or a hefty sum later in life. Use it as a retirement fund or as a deposit for your new home when you decide you want to go it alone. The best time to start saving is yesterday - the second-best time is today.
4. Achieve Short-Term Goals
Saving money isn't just about being prepared for long-term expenses, like a new car or a deposit on a home. The more you learn how to save now, the easier it is going to be cash aside for little expenses too. If you have a good savings strategy in place, then you won't have to panic and wonder where you're going to find cash the next time your friend asks you to go on a vacation with them or go abroad to check out an internship opportunity.
5. Get in the Habit
Finally, saving money and learning how to be frugal with your spending is routine. Like any other habit like fixing your sleeping schedule , it takes time to master. At first, you'll be struggling to decide whether you should save money now, or buy the thing you want immediately. As time passes by, it will be easier to recognize the impulse to purchase something that you don't really need and ignore it. This ability will come in handy later in life and could stop you from getting into some sticky financial debts.
Start Saving Now
Saving might not be a lot of fun, but it's one of the most important things you can do to protect yourself and set up a stress-free future. Being a student doesn't have to mean ending up with lots of debt by the time you graduate. Now could be the perfect time to start practising some financial independence.
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