7 REASONS TO $AVE MONEY.

Nest egg savings
This is the time of the year in Singapore where fresh graduates are just only embarking on their corporate journey. There will be many challenges and questions that lie ahead of these graduates. One of the most niggling issues will be that of accumulating money. Why is there so much pressure to save money? Why is there a need to put aside cash each month? There are a variety of reasons to begin saving money. Different people save for different reasons. But they mostly fall into these genres:

1. Save for Emergency Funds

It is important to have an emergency fund set aside to cover unexpected expenses. This could cover an unexpected car repair, your emergency appendectomy or a sudden job loss. Ideally your emergency fund should be about three to six months of your expenses. If you are just starting out you should put aside at least $1000.00 for this.

2. Save for Retirement

Another important reason to save money is your retirement. The sooner you start saving for retirement, the less you will have to save in the future. You can put your money to work for you. As you continue to contribute overtime you will be earning more interest on the money you have, then you put in each month. You should at least be contributing up to your employer’s match and eventually you will want to contribute ten to fifteen percent of your gross income.

3. Save for a Down Payment for a House

A third reason to save money is for a down payment on a house. Your negotiating power goes a lot farther when you have a significant down payment towards your home. You will receive better interest rates, and be able to afford a bigger home. You can determine how much you save towards this each month depending on your circumstances.

4. Save for Vacations and Other Luxury Items

A fourth reason to save money is to have fun. You can save up for your tour of Europe or that Caribbean cruise. Additionally you can be saving for fun large ticket items such as a Playstation 3 or a new boat. Your negotiating power is stronger if you have cash in hand on bigger purchases. Plus you do not want to be paying off your trip to Europe in five years.

5. Save for a New Car

A fifth reason is to purchase a car with cash. You will be amazed at how much money you can free up in your budget if you do not always have a car payment. You can also negotiate the price of the car much lower if you are willing to pay cash at the dealership.

6. Save for Sinking Funds

A sixth reason is to build up your sinking funds. A sinking fund is money you set aside for future repairs or improvements on your car, home or other possessions. This planning can help you to stop dipping into your emergency fund every time you need to fix your car.

7. Your Education

A seventh reason to begin saving money is for your future education. Each year more people return to school to earn their masters or doctorate degrees. You may also consider saving for your child’s education when the time comes.

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