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How To Become Financially Independent 9: Saving

If you’re an entrepreneur, chances are that you manage your money well. However, when cash flow is tight, entrepreneurs can quickly find themselves dipping into their dwindling savings account. Savings are created simply when you spend less than you earn. Of course, it sounds a lot easier than it really is. In a world where the objective is to get the newest car, better clothes, faster gadgets and a big house, you can quickly find yourself on a downward spiral where you are spending more than you earn.

Savings acts as a safety buffer. First, it provides the opportunity to have an emergency reserve in the event that income ceases. Secondly, they provide the ability to have funds to allocate to investment and a prosperous future. One of the smartest things that you can ever do for yourself is to develop the habit of saving part of your salary, every single paycheck. 

The habit of saving will teach you how to distribute your income systematically so that a definite percentage of it will steadily accumulate, thus forming one of the greatest known sources of personal power. No one may succeed in life without saving money. There is no exception to this rule, and no one may escape it. Put aside 10% of your earnings to be paid to yourself. Save them for your dream.

For the law of saving to really work, you need to commit to it regardless of your current financial condition. Many people start by saving ten percent of their income and then graduate to saving fifteen percent, twenty percent, and even more. And their financial lives change dramatically as a result. When you regularly put away ten percent of your earnings, you soon become comfortable living on the other ninety percent. The remarkable thing is that when you force yourself to live on the other ninety percent, you will soon become accustomed to it because you are a creature of habit. This teaches the subconscious mind that this saving is non-negotiable.

Begin today to put away ten percent of your earnings. Set up a special account for this purpose and treat your contributions to this account with the same respect that you do your rent or mortgage payments each month. Secondly, become a lifelong student of money. Read the best books, take courses and subscribe to the most helpful magazines. Know what you are doing so you can always make intelligent decisions when you invest your funds.

Financial freedom comes to the person who saves ten percent or more of his income throughout his lifetime. Individuals, families and even societies are stable and prosperous to the degree to which they have high savings rates. Savings today are what guarantee the security and the possibilities of tomorrow. You will need self-control to say no to purchases that are not essential and the ability to not dip into your savings account, which is slowly building.

In order to save, you have to go without buying something. Being able to make the necessary sacrifices is necessary for character building. The fact that only those with savings have capital available to invest in businesses and other forms of potential investment should motivate you to save. Without the motivation to save, results will quickly wane… or may never even begin.

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