Ever since we were old enough to work, we’ve been taught about the importance of saving.
We were told to ‘save for a rainy day’, but how do you decide what counts as a rainy day? How do you know what’s worth dipping into the pot, and what can wait until next month?
If you’re one of the lucky people who has enough disposable income to siphon some off for savings each month, it can be hard keeping that pot untouched. We’ve all been there: spending a little too much on a night out, indulging in some retail therapy or booking a last-minute getaway.
It’s tempting to borrow from yourself to pay for that thing you’ve wanted for a while, and while we all deserve to treat ourselves, you might want to first consider if you have the funds to cover the potential expenses we all face from time to time.
Below, the team at MyFavouriteVoucherCodes have listed 10 major life events you should continue saving towards.
A personal finance crisis
Here’s the rainy day we were talking about.
‘One of the biggest reasons that people dip into their savings is to cover the cost of a personal finance crisis,’ the experts at MyVoucherCodes tell Metro.co.uk, adding that, if you don’t have an emergency fund already, you should.
‘No one can anticipate when a personal finance crisis could happen, but you can prepare yourself as thoroughly as possible for when it does (although we hope it never does).’
As the cost of living goes up, wages are staying the same. This means that many people are living paycheck to paycheck, and putting aside a little to help you out if you lose your job can make all the difference.
To keep an emergency fund safe and avoid temptation, try putting it in a savings account that isn’t instantly accessible. Knowing you have to wait a day or three for the money to drop in your account can help prevent impulsive purchases.
To our parents, upgrading your tech to the latest gadget might seem like an unnecessary expense. But we are an increasingly digital generation that rely on a laptop and phone for everything, from doing our jobs to getting around and chatting to friends.
When funds are tight, a simple brick phone can do, but there’s still the chance your phone or laptop could break, or you could lose it.
For a lot of us, having a fast laptop is the difference between getting a job and not. So, if you’re fed up of your laptop constantly being slow and overheating, or simply want a phone that doesn’t die within half an hour, it’s time to start saving.
‘If you want to save up to spend big on something that will tangibly improve your day-to-day living, as opposed to luxury items that get used once and stowed away until the end of time for fear of breaking them, tech upgrades are the way to go,’ the team at MyVoucherCodes argue.
Visiting your bucket list destinations
What’s on your bucket list? Do you want to see the Colosseum in Rome, the Northern Lights in Iceland or the Christ the Redeemer statue in Rio de Janeiro? We don’t need to convince you to save for these trips, because who doesn’t want to travel everywhere?
However, it can be easy to keep putting this off, thinking you’ll go travel to these places ‘at some point’. As the experts say: ‘A little bit of responsible saving can be the difference between a once-in-a-lifetime experience and missing out. Whether it’s the staggering, the sweeping deserts of Dubai or the legendary Egyptian pyramids, there’s no shortage of bucket list destinations to visit.
‘By regularly dipping into your savings, you might only be able to afford a trip to your local supermarket.’
Buying your first property
Right, we all know that for many of us millenials or Gen Zers, owning a house is off the table. But if having a mortgage is important to you, it’s worth saving for, no matter how long it takes.
The market is in a state right now but, ‘if you’re in a position to continue renting until the market resets, then it’ll make all the times that you resisted dipping into your savings even more rewarding,’ the team say. ‘Also, if you plan on making upgrades to your home after you’ve bought it, that’ll cost a pretty penny too.
Your wedding day
Technically, weddings only cost £35 per person. That covers the fee for the local register office to check your valid passport, details of the venue for your ceremony, proof of any name changes and your home address.
Of course, though, if you’re getting married it’s likely you’re going to want more than a quick registry job.
It doesn’t need to be an extravagant blowout, but even if you keep it low key you still need to cover costs for the wedding dress/suits, food, venue, photographer and a cake. If you want to give your guests a free bar, that’s going to cost you too.
It makes sense to start saying well in advance for a wedding, and to not touch it until you start planning for the big day.
Expanding your family
It goes without saying that having a child is one huge stressful commitment. And now, the cost of living crisis has added an extra challenge to an already major life milestone.
‘In fact, there are approximately 160,000 new challenges,’ the team at MyVoucherCodes explains. ‘That’s right – the current estimated cost of bringing up a child is an eye-watering £160,000 thanks to hikes in childcare, food and fuel prices.’
For a lot of us, that number is impossible to get your head around, but it’s clear that you will need to start saving if kids are in your life plan.
Getting a pet
If kids are just not part of the plan, you might be eyeing up a fur baby instead.
Pets are way less expensive than human children, but looking after than still costs a substantial amount. Say you want to get a dog. There’s are the costs of a bed, collar, lead, toothbrush, food and water bowls and, of course, some toys to play with, to think about.
‘You also need to pay for your dog’s initial course of vaccinations, monthly wormers until your dog turns six months old and neutering,’ the team added.
The experts did some digging and, according to the People’s Dispensary for Sick Animals (PDSA), a dog could cost at least £4,600 but, depending on the size of the breed, the potential lifetime cost could be as much as £30,800.
Protecting your loved ones
It’s a scary thing to think about, but life insurance is important. It works just like you might insure a gadget, or a car, but instead, you are insuring something much bigger and more important: your life.
The experts at MyFavouriteVouchercodes have the low down on different life insurance options: ‘With term life insurance, you pay a set fee each month and that correlates to a payout if you die.
There are also permanent life insurance schemes, which are very self-explanatory. Some permanent life insurance schemes will allow people to accumulate a cash value, giving you a little extra peace of mind and your loved ones a little extra protection. In the short-term, you could also choose to purchase income protection should you find yourself off work sick for a prolonged period of time.’
Sending your child to university
Right, so you had a child and raised them. They are 18 now, so that’s it.. Right? Well, not really. If your future child decides to go to university, they are going to be hit with a barrage of rising interest rates and be set to face more debt than ever before.
While the running joke of student life is how broke you are the whole time, things are only getting more expensive and you will want your child to be able to afford vegetables so they don’t get scurvy.
‘It would be wise to set some money aside to help your child, current or future, with a little extra pocket money each week so that student loan debt doesn’t haunt them for the rest of adult lives,’ the experts added.
Making your retirement as cosy as possible
This is the big one. For a lot of young people on low incomes, considering retirement seems way down on the list of priorities, but given that the cost of care is expected to rise by 20 per cent to compensate for the surging cost of carers’ wages, energy and food, if you can afford to put aside even small amounts then you really should be.
A rise of 20% means that care is going to cost approximately £30,000 more per resident over the course of an average three-year stay, bumping the average care home fees from about £25,000-a-year to closer to £30,000-a-year.
Needless to say, most people don’t have an extra £5,000 per year to spend on their retirement,’ the team says, but that’s all the more reason to put money aside for it now.
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