Saving your money can be hard work, especially if you’re having to save the only bit of spare cash you have each month. This normally means you can’t buy those little treats you like so much or you can’t have take-away food on a weekend and after a while you probably think ‘why bother saving at all?’ Well according to a number of surveys there are two main reasons that people give for saving their money:

1. So that they can purchase a significant item without having to resort to any form of credit,
2. To build up a nice little nest egg for retirement or to keep them going should their personal circumstances change in any way.

There are of course other reasons but these are the two that are worth focussing on here.

Saving to buy what you want

It is very unlikely that you or anyone else can sit there right now and not be able to think of a single thing they would like to go and buy. Whether it’s a new TV, a car, a bigger house or just the jumper and jeans combo they saw while out shopping, everybody can think of something they want. Unfortunately most people today have the ability to go and buy what they want when they want it but more often than not this impulse buying requires the use of a credit card, or for larger items a personal loan.

Using any form of credit to make a purchase means you end up paying interest as well as the purchase price and on a large item such as a car this can, and will, take years to pay off. Saving your spare money for the same car will obviously take a good while longer however while saving you are making money in the form of interest and so you actually end up using less of your own money for the car. Smaller purchases, such as new clothing or household goods will take a lot less time to save for and so it may be that you only have to wait a few weeks or months to get them. Doing it this way means that once you hand over the cash, that item is yours and you wont be paying for it, along with the interest, for the next however many months.

Saving for the future

The second reason that people give for saving is so they have something to fall back on in the future. This can be a retirement fund or just a little nest egg should they need cash in a hurry. There are literally hundreds of unforeseen disasters that can strike at any time, from the washing machine breaking down to getting laid off at work and it is always good to have a healthy savings account that you can dip into should the need arise.

If you manage to stay disaster-free then your savings can be used to ensure a good life during your retirement years. This is the great thing about savings – they remain where they are until you want to use them and all the time they’re sitting there in the bank or building society, they are earning more money for you and your future.