The Benefits of Saving Money for College Students
What is the purpose of making money if you are saving it for the future and not enjoying the present? Saving money is valuable because it gives people the opportunity to earn interest while keeping their money safe. While you are still in school, it is a good idea to open a savings account and put some of you earning into it.
I cannot stress how it is important to save when you are still young. Attach a mental picture or a goal that you can use when putting money into a savings account, something that motives you. Like when saving for a trip, take a picture of a palm tree next to a beach with clear blue waters, and remember that image or idea to your savings plan.
Save now, borrow less later.
As a 20-year-old guy working a part-time job with a fair amount of savings, I live below my means. Here are my advice: Save money the same way you pay your bills before you reward yourself (in reasonable amounts). Odds are you are not going to buy your first car or house with cash. Do not trick yourself into thinking that this is the norm. Make a detailed-plan you can follow to spend less and save more.
And a side advice is to invest early. I use an app called Acorns to invest my money. Acorns creates a way to help people start investing, no matter how much money they had. Even though a savings account reserved your money, you would miss out on potential growth. A little goes a long way 20-30 year down the road. Many people put off getting started because they do not have a lot of money to open an investment account, but that is not the case anymore.
Becoming Financially Independent
Savings accounts and other savings options such as certificates of deposit are beneficial because they provide the account user with the opportunity to earn interest on the savings with little to no risk. While the interest rates are usually low, the amount earned in interest is one of the reasons for saving.
However, investing your money offers higher returns than bank savings accounts and possibility help people build wealth over the long-term.
Before we continue, I want to say the fact that if you read this article, click on the link to sign up for Acorns, and do sign up for the service, I do earn a little bit of money. I earn $5 that will be deposited into my Acorns account, but so do you! This might seem like it is an incentive for me to sponsor the app just to get people to sign up, but that is honestly not true. I wrote this article because Acorns is a respectable service and a great way for college students to start investing.
College students with a valid .edu email have all fees waived for four years, which means you can start growing your money for four full years free. Use this to your advantages because this opportunity may not happen soon, so take it while you can! After that, you will pay $1 a month for access to Acorns.
Start early and stick with it.
Start today by putting aside some cash every day until you have an emergency savings fund of $1000 to $5,000. If you receive a bonus from your job or a tax refund, use that money to get you started or to add to what you have already set aside. As life happens and you need to use your fund, bring it back up again. It takes a bit of work, but it is a routine worth doing.
There is a lot in your future that you cannot predict, so putting away some money to spend when you need it is organizing and taking control over your future and money related issues. Spend money responsibly. Save on a regular basis. Have an emergency fund. You have nothing to lose by saving, and a bright future ahead.