In today’s expensive world, almost everyone has some kind of
debt. The most common types are credit card debt and student loan debt. And,
while paying off these debts is definitely important, the most important thing
of all is to save money. Since life can sometimes throw unexpected events your
way, it’s imperative to be prepared.
It doesn’t really matter how you set up your “emergency
savings.” One of the simplest ways is to just open a savings account where it
can be accessed at any time. That way, the next time there’s an emergency, you
can dip into your savings, rather than reaching for your credit card.
Of course, saving up doesn’t mean that you should totally
neglect your debts. With each paycheck you get, you should first aim to pay all
of your necessities, like your mortgage payment and your utility bills. Then,
from there, you’ll want to pay at least the minimum amount owed on your most
serious debts. It might take you longer to pay off your debts this way, and you
might even pay more on them over time, but it’s better than paying nothing and
ending up having nothing.
When your bills are behind or you just have a lot of debt,
your ability to get credit or a loan tends to be pretty low. So, if you found
yourself with a broken down car or a sudden need for medical care, how would
you pay for it? If you have adequate savings set aside, you could probably pay
for what you need quite easily, but if not, you’d be left to fend for yourself.
These kinds of examples show why saving money is so important and why you
should always make it your top priority above everything else.
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