Budget and save, save and budget – two very common goals that come up frequently here. We talk about why it’s important and some ways to get there, but what are these things we’re actually saving for? Here’s a list of 5 common things that you should be thinking about setting aside some money for:
1. Unemployment. Whether you’ve had a stable job for years or you’re just starting out in your field, there’s no guarantee that your position is promised to you. It’s recommended that you have enough saved to cover at least 3 to 6 months’ worth of expenses.
2. Emergencies. No one can predict the future, so that makes it hard to plan for. However, you can be better prepared for surprises that might come your way, whether it’s a medical emergency or unexpected home or car repairs.
3. Retirement. A lot of younger folks tend to ignore the importance of this, but it’s something you should definitely look into after finishing college and starting your career. A lot of employers have programs that make it really easy to put aside some savings for this, and a large number of them will match your investment!
4. Your child’s schooling. I think about this a lot more as starting a family seems closer to the near future as opposed to a distant pipe dream. I definitely want to encourage my children to take as much responsibility for their education as possible, since I covered the majority of my college expenses, but I also don’t want them to feel burdened or overwhelmed with debt. While I plan on setting aside a fund for them, budgeting and financial planning are both topics I fully intend to discuss with them.
5. A little something special. Sometimes, it’s nice to treat yourself, whether it’s a vacation or a new pair of shoes. Budgeting and saving for these types of things makes you less likely to resort to using credit cards for these purchases, and who doesn’t like having something fun to look forward to?
