Save for a Cushion
We have a metal bench glider for sitting out on the patio. But we need a cushion to be comfortable sitting on it.
I imagine you like to be physically comfortable too. I also think we all like to be comfortable financially. And recent concerns over inflation have made that difficult.
Savings accounts are a great source of comfort during financial stresses. They provide a cushion against the hard things in our financial life.
However, the practice of accumulating savings can also become a tool for opening many doors and windows of opportunity!
Windows Open
Many years ago, I had a neighbor who always carried cash with him to be able to take advantage of deals, such as on old cars that he could resell for a profit. He looked for people who were desperate to sell things well below retail prices.
When people are done using things, they often are willing to sell them for a small percentage of what they paid for them, often just to free up space at home. With cash in hand, you could find some sensational deals!
Of course, estate sales and garage sales offer many discounted buys. However, learn to negotiate for an even better price. It never hurts to ask!
I know many people stay away from deals on equipment or vehicles for fear of needed repairs or the appearance of neglect. But being aware of the cost of repairs will make buying decisions easier.
I noted one such observation in a car magazine article. A mechanic reflected on the numbers when buying a used car. The example was of buying an older car with a modest number of miles and not well maintained. The mechanic noted the deal was the price plus the intentional repairs and maintenance to get it back to being a dependable vehicle. For instance, new brakes, new tires, new fluids, and a tune up would work wonders with most vehicles.
If you were shopping around for cars you might like, with the potential repair cost in mind, your negotiating position would be much better. Especially with cash in hand!
The Doors
There is a lot of excitement when you are watching Let’s Make a Deal on TV and they offer the choice of what is behind three doors! Which one would you choose?
Having cash in your pocket and in a savings account can get you excited about what doors might open for you too!
But let’s reflect on the possible uses of that pool of money you sacrificed to accumulate. And to be clear, this is the amount of money above the defined amount you set aside for unplanned expenses.
Consider these possible uses and why cash might give you an advantage.
First, learning skills can enhance your ability to earn additional or optional income. Personally, I have had to pass on classes because I did not have the cash to pay for them. One cautionary thought about using credit to pay. The interest expenses might delay any real benefit from learning those new skills, plus you may experience stress over the loan payments.
Second, I once ran a lawn and landscape business on the side, and I am working on developing an online business. Both efforts required equipment. Cash in hand would greatly enhance your ability to take advantage of sales or bargain sourcing for your equipment and supplies.
Third, rental property is great until the owner is done with it. So, with available funds for a down payment, you might come across someone willing to offer you a deal to get out of the business. Be aware, though, that some maintenance may have been neglected. So be prepared for some painting, window replacement, or some plumbing issues.
Fourth, for those who are energetic and willing to work long hours, there may be opportunities to buy an operating business of interest. The equipment and goodwill should be in good condition to minimize any major expenditure over an agreed purchase price. Cash can sweeten the deal!
Remember, cash can lead to big savings!
Read to Measure
Make note of your interests. Some of your interests may be with a hobby or a potential career.
Your employment options may not be of interest. However, give yourself a goal for saving and you can generate enthusiasm to do most anything!
Be a reader. Discipline yourself to make time to read. Define how much time to allow and how many books to read in a year. You need information to make good decisions, and reading will help you make smart decisions! And I do consider podcasts and audiobooks as sources of information. Just remember to confirm the information with two different authors.
Taking courses and reading related materials were very important to my confidence to develop an online presence for my own blogging effort!
Reading resources that will help you recognize retail values on items of interest from personal items to real estate can also help you identify when they are offered for sale at a discount. You will know that savings are real!
Remember, money in hand gives you an advantage over those who must seek financing to make the purchase!
Motivate to Move
Find motivation to save. Savings can be an exciting adventure if you create a goal for that accumulation.
If you fail to set some goals, you may get distracted by the size of your growing savings account and the many fun things you could buy with those funds.
Fun things are fun until you discover you used the funds required to buy something you really needed!
Move Forward
Your present situation may not be very pretty, maybe even desperate. And then, you hear about some retired person buying a house in Florida or Arizona to get away from the colder climate they live in. You think why can’t I have the resources to do that?
But you must realize they had very little when they were young. And, yes, they may have avoided divorce or lengthy job losses. However, they learned how to save. They built a retirement account with consistent contributions.
Hopefully, you have many years ahead of you. What are your plans to make your situation better?
My suggestion is that you take a hard look at how you have been spending your income. Then, consider how you can cut back to make savings a priority!
For you to move forward and show progress, you will need cash on hand above what most advisors suggest you must have to cover your potential emergencies.
Invest in your potential for getting deals which can add savings to your living expenses. A little money on hand can improve your lifestyle!
Build Some Good
On occasion, we can help our children or grandchildren who are struggling.
That is both a privilege and an opportunity to teach about the importance of saving for unplanned expenses.
Most people who are successful have children who are self-sufficient. I do hope you can encourage your children to do well on their own!
Being able to help others, even those outside your family, can be a blessing to your soul!
Make saving worth the effort!
Be a Good Influence
Because you are well-read and an observer of what makes a good deal, you have the potential to be a good influence.
Perhaps you can influence a child to live with a frugal attitude to generate savings that will open doors that can lead to future success.
Be a living example of this practice and you can influence many more than just your children. And serving others well has led many to further success!