This probably isn't the first time someone has recommended that you save early and often. But have you ever thought about why this simple advice works so well for those trying to retire comfortably? The magic of compound interest is a major reason to start saving young, but there are also a variety of other large and small ways a savings habit will help you throughout your life. Here are five additional benefits of developing the discipline to save early:
You will end up wasting less money. While making more money works wonders, reducing your spending is the simplest and quickest way to increase savings. When you make the commitment to start saving as soon as possible, you will make a budget and try to cut out things you don’t need. Luckily, just about everyone will find that there are many things you can cut without making a serious sacrifice to your living standard. You just have to look.
You're more likely to find compatible social circles early. The earlier you adopt frugal habits, the more likely you will be to end up hanging around people who are financially compatible with you. This not only helps you enjoy life without spending a lot of money because you will do activities together that don’t require a ton of money, but there's also much less desire to keep up with the Joneses. And when you are ready to look for a long-term relationship, you'll be more likely to find a potential spouse who shares your goal of retiring with a comfortable nest egg.
You will have more options to pursue the right opportunities. Not everyone has the perfect career path planned out upon graduation from school. Unfortunately, changing course midway often involves pay cuts or gaps in income. When you save early, you will amass a reasonably sized stash that allows you to take opportunities you wouldn't be able to if you always lived paycheck to paycheck.
You will be more confident. Don't underestimate the power of knowing you have the assets to weather any storm. By saving early, you will always know you and your family will be OK no matter what, which will be important for you to take bold steps at your job. You will be less afraid of losing your job, which might even help you perform at a higher level.
Your quality of life will improve. Many people are stressed out because their finances are tight. Then, they try to deal with it by eating comfort food, which ends up making them tired and overweight. Eventually, the stress leads to family conflicts because emotions are always high. When you save early and practice living below your means, all this can change. You are no longer as stressed out because you no longer need as much income to sustain your lifestyle. The stash you've already built up helps tremendously too. Plus, the weight lost and harmony within your household adds tremendous value to your quality of life.
I can't stress enough how important it is to commit to saving as early as possible. Don't invent reasons you can't direct more money towards your stash. Commit to a dollar if you have to. Take the first step and go from there.
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