When you’re trying to figure out your family’s budget, a large part of your focus is around the money you’re spending. How much are you spending, and where is it going?
Between your bills, your debt, and your everyday expenses, you might not find yourself with a whole lot left over. Still, it’s important to save your extra cash – and it’s just as important to know what you’re saving it for.
Keeping a big stash of cash in a savings account with no real plan isn’t necessarily a bad thing, but there are plenty of purposeful ways you can save that money if you step back and put a bit of structure into place.
If you aren’t sure if you’re saving up for the right stuff – or you aren’t sure what you’re saving for at all – here are five things you should absolutely be putting back money for right now:
Your retirement
It might feel like a lifetime away, but one day, you’re going to want to stop working and enjoy your final years in peace. While Social Security benefits may help cover your costs, the days of pension plans are long gone, and government benefits will rarely come close to covering all of your expenses in retirement.
Instead, it’s largely up to us as individuals to save funds for our retirement, so it’s smart to start the process as early as possible to make sure you’re set up for success down the road.
Your debt
Do you carry a balance on a credit card? Owe money on your car? Pay a mortgage? If you’re anything like most Americans, you answered yes to at least one – and likely a couple – of those questions.
While debt is seemingly a part of modern life, it’s a good idea to strive to be debt-free. Instead of spending your extra cash on frivolous expenses, save it up so you can make an extra payment toward your most burdensome debt.
Critical repairs
Over time, things wear out and break down. Car parts fail. Air conditioners, water heaters, washing machines, and other appliances need replacing. These expenses often come up with no warning and can’t be put off, which can put us in a pretty bad position if we aren’t prepared to handle them.
Instead of letting these big expenses catch you off guard, it’s smart to anticipate them and keep some spare cash stored away to cover the costs of major repairs.
Personal emergencies
You should always, always, always have an emergency fund. I repeat – always! You never know what life’s going to throw at you, and if you aren’t equipped with a little cash to handle a potential emergency, you could find yourself in a bad spot.
If you don’t already have enough cash saved up to cover the cost of a last-minute plane ticket, a visit to the emergency room, or unexpected unemployment, you should make this a priority.
A rainy day!
While it’s important to manage your money responsibly and make sound choices around your purchases, you’ve got to have a little fun. Whether that’s a spontaneous weekend road trip, a new television before the big game, or a trip to the movies on a dreary weekend, you’ve got to let loose once in a while and treat yourself.
From a little fun money for a rainy day to the cash you need to keep your family financially afloat when the unexpected strikes, there are plenty of reasons to save your spare cash.
These are just a few of the most important things you should be saving for – not an all-encompassing list.
Is your family currently saving up for anything big? Leave a comment and let me know!
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