This is an adage every individual who earns their own money should live by. Most of us have big goals in life – a dream wedding, a foreign education, or buying the latest four-wheeler. Or perhaps we want to build an emergency fund for a rainy day. To fulfill your dreams, you need to start saving early on in a consistent manner. When you save with an end-goal(s) in mind, you can also exercise more financial discipline. Ultimately, you can realize your goals by growing your money steadily in a savings account.
Here are some of the top benefits of goal-based savings.
Fulfilling big dreams
Establishing financial goals is an important step towards stability and security. It is important to set dreams and targets, and then work towards them. This can be anything that is of value to you, say buying a car, building your own home, funding your kid’s education, retirement savings, etc.
Say, you want to fund your child’s education in 10 years’ time. When you save towards this goal, you can build enough savings so you don’t have to borrow money. Or perhaps you don’t have to take a loan if you have enough savings. Instead of raking up debt, save aggressively to pay your way through the best education money can buy. You can apply a similar principle for other big purchases such as financing your wedding or buying a house.
Inculcates financial discipline
Discipline is important for adopting good financial habits. Goal-based savings make you accountable for your spending. When you have made a decision to attain a certain financial goal, you will start categorizing your financial journey into steps. This includes regulating your spending, putting a certain sum of money aside every month, and so on. When you do this, you practice financial discipline in your life, which brings you closer to meeting your goals.
How to practice goal-based savings
To save in a goal-based manner, you need an effective tool that aids your journey. There is perhaps no tool that helps you do this better than a simple savings account. A savings account always keeps your hard-earned money safe while offering a steady rate of return on it. If you want to save in a disciplined manner, open an account with a reputed bank that offers modern banking services. This will give you access to rewards and other privileges that will ultimately make your financial life smoother.
To sum it up
Goal-based savings should be an essential part of your financial planning. When you save in a calculated manner, you actively work towards your life’s major goals, whether it is a big event or building an emergency fund. Open a savings account and start your goal-based savings now!