How to Save Money and a Lot of Grief
Learning how to save money is an important, invaluable habit that limits you in the present, but pays off in the future. Were all entitled to a little splurge every now and then, but indulge too excessively and youll find yourself delving into bankruptcy pretty quickly. Dont let money run through your fingers like water, but at the same time dont feel like you have to practice frugality to the point of depriving yourself. Its good to maintain a comfortable balancespend some, save some. Occasionally you might find yourself spending a little more or (more rarely) vice versa, but if you generally know how to save money and spend wisely, you can keep your finances afloat and youll prevent yourself from drowning in debt.
The key factor in saving money is the delay of gratification. In the short term youll suffer, but youll be rewarded in the long run. When you finally get your paycheck at the end of the month, you might be tempted to blow most of it on, among other things, that new, shiny, smaller iPod youve been eyeing this week. But think about itdo you really need to buy another mp3 player whose superfluous, fleeting existence will inevitably be supplanted by a fancier, even tinier design and anyway thrown in for free with the latest laptop youve also been eyeing, which in turn will be replaced by a sleeker model in a matter of months? To save money, you have to limit your spending so that you can spend on better, more worthwhile things later on.
Having a greater capacity to delay gratification is linked to positive outcomesresearch suggests that children who are able to put off eating a marshmallow in order to earn two marshmallows later are more likely to be agreeable and academically successful. The same concept can probably be applied to finances, in that individuals who know how to save money will be more financially successful in the future. This is intuitive, but often forgotten when youre living in the moment and not looking ahead.
In addition to watching what you spend, its a good idea to put some money aside in your savings account. Watch it accumulate and grow interest. Keep in mind that its a good practice to keep three months worth of your salary in your savings in case you become unemployed. But with our economy in the state that its in, you might want to extend that time period. Youll be prepared for whatever comes your way if you manage your money carefully. While you still have time, learn how to save money and save yourself a lot of trouble.
