Why Is Saving Money Important?

Close up of man holding pink piggybank while woman putting coin in it.
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More money is always considered better, especially where capitalism is concerned. While you may be constantly influenced to spend, take some time and think about how you can save. Saving money may not have the flash and pizazz of making it rain, but what you save now will truly benefit you in the long run.

Learn: How To Get Free Gift Cards From Your Everyday Purchases

Why Is Saving Money Important?

Besides peace of mind and expanding your options, saving money now can greatly enhance what you can accomplish in your present and your future. Even if you just start small, as most people don’t have extra cash to toss about, you will still have started — and that is a crucial step. Saving money is important, because you will get to define how your money works for you, as opposed to how you work for your money.

10 Important Benefits of Saving Money

There is no way around it: whether you are planning for your future or just want to be prepared for the unexpected, the benefits of saving money are too numerous to count. However, a good place to start considering why saving money is so important would be the following benefits.

  1. Retirement
  2. Job loss cushion
  3. Higher education
  4. Getting a car
  5. Homeownership
  6. Weddings
  7. Growing your family
  8. Emergencies
  9. Rainy day funds
  10. Fun Stuff

1. Retirement

Retirement is that distant dreamland all members of the workforce are thinking about when you see them gaze off into the distance. Dreaming about retirement and being prepared for it are two different things.

Make Your Money Work for You

Saving for retirement is important to ensure you have a comfortable future. You will be able to stop working out of necessity at a reasonable age and provide for yourself and your family without a regular income.

2. Job Loss Cushion

In today’s economy, there are no guarantees for job stability. If the worst happens and you do suddenly lose your income, or your partner loses theirs, having established savings will help tide you over until you can get employment elsewhere.

3. Higher Education

The reason you don’t pursue your undergraduate college education, master’s degree or doctorate should never be money. Higher education is expensive, and having savings can alleviate not only the upfront costs but also tuition payments.

4. Getting a Car

A huge benefit of saving money is not having to borrow money for big expenses like cars. If you can pay for the car out of your pocket, you can save tons of money on interest and monthly payments.

Make Your Money Work for You

If you live in a place without convenient public transportation, cars are a vital part of commuting to work, driving kids to school and even getting groceries. Cars are a big expense, but you pay less if you save more.

5. Homeownership

When you are growing up, you always dream of one day owning your own home. How you turn that dream into reality depends on how much money you can save. Even with both inflation and interest rates being high, this is still within the realm of possibility.

Having enough money saved up is one of the first and most important steps to being able to make a down payment on a potential home. Any mortgage applicant has to prove they have enough money to make a down payment, which is typically a certain percentage of the total cost before the loan is even approved. The down payment won’t be the only expenditure when buying a home, but it certainly is enough incentive to start saving.

6. Weddings

Weddings can be a racket. All the components that go into throwing this party for marital bliss quickly add up. When you save money for such a big event, you will be able to afford more or higher quality versions of the following:

  • Catering
  • Music
  • Flowers
  • Decorations
  • Venue
  • Bride and groom apparel
  • Cake
  • Rings
Make Your Money Work for You

7. Growing Your Family

You never hear anyone say how inexpensive it is to raise children. From school supplies to doctor bills, those little bundles of joy are going to set you back a few dollars. If you are in the part of your life where you want to start a family, or even just think about it, having a solid foundation of savings can be the base for your family to grow.

8. Emergencies

If only you could plan for emergencies, they wouldn’t be such a financial burden. Unfortunately, emergencies are going to do what emergencies do and that includes happening when you least expect them. They are never fun, but they are much easier to navigate if you have savings to fall back on.

Whether it is medical bills, a fender bender or even a tragic loss in the family, when you have saved money for the unexpected, you can focus on what needs to be done instead of how you can afford to do it.

9. Rainy Day Funds

Well, it is raining. Literally, it is raining in your basement. Home repairs can be planned, but they can also pop out of nowhere. Shelter is a non-negotiable for you and your family, so one of the benefits of saving money is you have a way to pay for services such as plumbing and roofing.

If you have saved enough money, you could even take this opportunity to remodel your basement a little. Putting money into a fund that can be used when you need it, but also when you want it, is an ideal investment.

10. Fun Stuff

Sure, there are taxes, repairs and tuition you need to save money for, not to mention food and shelter. However, life is all about balance, and if you have worked hard and diligently saved money at every paycheck, reward yourself. One of the best benefits of saving money is treating yourself to anything from an amazing dinner to a well-earned vacation.

Final Tips

Saving money is always a good idea, because having savings you can count on will come in handy no matter what life circumstances befall you. Regardless of why you are saving or what you are saving for, here are a few helpful tips to get you started.

  • Set aside a percentage of your paycheck each week. 
  • Take advantage of and match your employer’s 401(k) option.
  • Rent out a spare room.
  • Cancel automatic payments on subscriptions you don’t use often.
  • Make a weekly meal plan to eat at home.

FAQ

Here are answers to some commonly asked questions about saving money.
  • What are five benefits of saving money?
    • There are many benefits to saving money, but some of most prime examples are the following five:
    • Retirement
    • Job loss cushion
    • Higher education
    • Getting a car
    • Homeownership
  • What are the seven most important reasons to save money?
    • Saving money in this economy may seem like a stretch, but its importance cannot be understated. Here are seven important reasons to save money:
    • Getting a car
    • Homeownership
    • Weddings
    • Growing your family
    • Emergencies
    • Rainy day funds
    • Vacations
  • Why is saving money important?
    • Besides peace of mind and expanding your options, saving money now can greatly enhance what you can accomplish in your present and your future. Saving money is important because you will get to define how your money works for you, as opposed to how you work for your money.
  • What are ten ways to save money?
    • There are many tricks and tips to save money, but here are 10 ways you can start today:
    • Meal plan and eat at home instead of going out to eat.
    • Make your lunch and coffee at home to bring to work.
    • Cancel unused subscriptions.
    • Get rid of cable or downsize other home expenses.
    • Pay off credit card debt as soon as possible.
    • Set aside a percentage of your paycheck every week into a savings account.
    • Sell unwanted belongings online or in a garage sale.
    • Get a roommate or rent a spare room.
    • Get a side gig for extra income.
    • Switch from name brands to generic brands.
  • What is the importance of saving money?
    • The importance of saving money is to best prepare you for all the things you want to do in life, as well as handle all the things life throws at you.

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Make Your Money Work for You

About the Author

Caitlyn Moorhead has written content for a variety of businesses and publications. After graduating from Central Michigan University cum laude, she moved to New York City where she wrote columns, articles and plays for several years before relocating to Austin, Texas in the fall of 2020.
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