If you are young and started working recently, it is essential to understand why you should save and invest as early in life as possible. Check out this post to know some of the top reasons that make saving and investing a must for every individual.
The feeling of being employed and earning your own money after years of studying is incomparable. But now that you are employed and have increased responsibilities, this is the right time to think about the future and start saving.
From achieving your financial goals to being ready for financial emergencies, several reasons make saving and investing a must for every individual. Here are some of the top reasons why you should save and invest from as early in life as possible-
- Financial Emergencies
One of the biggest reasons why you should save and invest is to stay prepared for financial emergencies. Life is full of ups and downs, and you never know what might happen in the future. With adequate savings and investments, you’d be more prepared to handle such emergencies. You can also consider creating an easily accessible emergency fund solely for financial emergencies.
- Achieving Life Goals
From buying a house of your own to paying for child’s education, you may have a host of objectives that you’d like to accomplish in life. Now that you are employed, it is time for you to set these goals based on their priority and start working towards achieving them.
If you are serious about achieving these goals and want to meet them as soon as possible, saving and investing can help you in the process. Select an investment option that best suits your investment style and financial objective to start putting your goals into action.
- Growing Your Savings
The rate at which the cost of living is increasing in India means that savings alone will not be adequate to take care of your financial objectives. You should start investing from a young age so that your savings can grow as you move through the different phases in life.
Make sure that a part of your savings are parked in a savings bank account so that it is readily available when required. The remaining should be smartly invested so that it can provide decent returns, and your savings can grow considerably with time.
- Planning Retirement
If you want to make sure that you can live the retirement of your dreams, you need to start planning and investing for it right when you are in your 20s and 30s.
Most of the investments are of the nature that the longer you remain invested, the higher will be the returns. When you start investing for your retirement from an early age, you will give your investments adequate time to grow. With more time, you also get the freedom to commit fix the investment mistakes and earn better returns.
- Enjoying Financial Security
With investments in a savings plan like endowment plan or ULIP, you will also experience a sense of security. If you have just started working and cannot save or invest a lot of money at the moment, start with whatever you can. You can gradually increase the investment as you grow in your career and your income increases.