- 04
- Jun
Many young people are leaving it later and later in life to start saving money. However the longer you leave it to start saving the more difficult it is to actually save anything.
For example imagine the following scenario; suppose you wanted to have savings of £10,000 by the age of 30. If you started saving for that at the age of 13 you would only have to put away 78p a day till your thirtieth birthday. If you left it till they age of 25 you would have to save £4.47 a day, however if you only started saving on your 29th birthday you would have to save £27 a day to make it to £10,000.
From this example it becomes quite apparent that for each day you put off saving, the more and more difficult it will actually become to start saving. Therefore you can never be too young to start saving.
However smart financial decisions are not all about saving money, as they are also very closely related to how well you can save your time, for example if you like to shop in a posh shop for some perfume, you could save up to £10 if you were to buy that same item in a supermarket. But it is not only about saving £10. If you earn £10 an hour than you have also just lost a whole hour/s work as well.
Additionally, people don’t understand the facts behind APRs and interest rates. When asked the difference between a 10% APR and 15% APR, most people would say “5%”. The truth is actually 50%, because you would be paying 50% more interest on your loan or credit card. This is why it is so important to shop around when seeking financial products such as personal loans, car finance and cards. Taking the high rate offered by your bank could cost you a fortune in interest over the years.
Following these easy steps could save you substantial amounts of time and money over the course of your life. It’s your money – use it wisely!
