Cultivating a Saving Culture

  

Date Posted: 2/24/2018 5:24:56 AM

Posted By: ROZA  Membership Level: Silver  Total Points: 961

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Borrowing of loans has become a major problem in our society. Although loans can be a good source of income, people are abusing this practice and using it as a way of getting quick money. Some get a loan to buy a car and spend the next five years paying for it, and by the time they are through the car is already old and so they have to take another loan to buy another one. Some are buying big houses that they spend the whole of their working days paying for them. Some are even unable to finish paying for them and they end up selling the house to pay for the loan and in the end they left without a house in their old age. And the list is endless.

But the solution to this is cultivating a saving culture and learning to buy things using our own savings instead of borrowing loans. If one is saving 20% of their salary, they are on their way to being successful in life. To start saving, one needs to monitor their saving habits for about three months. If you spend even a small amount of your income, just note it down and at the end of the three months you will have known where you have been overspending. This is because in order to reach the target of your saving you will need to either cut down on your expenditure or add to your income. To add to your income you can do an extra job, especially those ones who are employed. Remember employed people are said to be the most time wasters. But instead of wasting time in your spare time or during weekends, one can do online jobs, farming, teaching or do something simple to add to their income.

As for cutting down on expenditure, the following are some tips on how one can do it:

i. Stay near your work place so as to cut down on the amount of fare that you spend.

ii. School your children where you can afford depending on your salary

iii. Don’t buy too expensive clothes if your pocket cannot allow it. Expensive clothes do not always mean you are decent. You can be decent without expensive clothes.

iv. Share a house with a friend, if you are not married. This will cut down on house rent.

v. Do not make a habit of giving small loans to family and friends, many people are not faithful to make sure that they refund your money.

vi. Whatever you do, do not spend more than your income. Adjust so as to not to strain yourself as you live a lifestyle that is beyond your income.

After you have succeeded in saving the amount you have targeted, instead of putting your money in the bank, you can invest it so as to earn more. The following are areas where you can invest your savings:

i. SHARES
You can invest your money in buying shares and selling them once it has appreciated to get capital gain. And since you will be part of that company, you will also be receiving dividends yearly.

ii. BONDS
Here you will be loaning the government and you will be receiving interest every six months.

iii. LAND
You can buy land in a remote area which has a potential of developing and selling at a profit once the area has developed.

iv. FIXED DEPOSIT
Although it is putting your money in a bank, you cannot withdraw it like in current and savings accounts and you will be earning interest.

v. FARMING
You can do farming as a business in your spare time and earn some income.

vi. BUSINESS
You can invest in a business and employ someone to run it but you will be the one managing it. If you are self employed you can add the savings to your business and make it grow some more.

Finally, what we need to in order succeed whether our income is little or much, is to cultivate a saving culture and be consistent in it. We need to start good spending habits, start saving and invest those savings regardless of how much our income is, then we will live a good life and have enough to take care of us even in retirement.

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