Is Saving Money Still Worth It?

There was a time when the average man of the working class. had scarce options to let his hard-earned money work for him…

He could profit from that 6-8% interest rate your bank would pay on your savings account. He could capitalize on the 4 to 8% provided by your government on its bonds.

or, if he felt adventurous, he could have even tried his hand in the stock market:

• buying shares of companies
• or trying to spread the risk through various investment funds.

But this was years and years ago…Today you are surrounded with more opportunities than you can reasonably handle.

And you are even blessed with more “free” time to try to decipher the code inside the lingo of the “professionals”…

And this just for the attempt to make yourself an opinion!! 😁😁😁

As a general rule, saving money will always hold value for almost anyone. But in the end, just saving is not going to provide relevant results for the vast majority of people.

We need a strategic plan capable year after year of maintaining, when not multiplying, the buying power of the money saved.

…A Little Rant…

(as a side note while I am writing this: today it is the 18th of December 2022, and right now Argentina is chewing up France 2-0 in the Football World Cup finale in Doha-Quatar.

…Well “Soccer World Cup” for the Americans here 😀…)

Why do I mention this? Because this 2022 World Cup edition will remain in the history for the multitude of workers who lose their lives building infrastructures for this Media-Circus….

I just wanted to share a moment to send some love to the family of the unfortunate human beings who will never walk the path back home, to their loved ones,

…for the only mirage of better income and a better life for their families…

And often without any better option to chose from.

Yes, I am inviting you to think about how fortunate we are:

Me for taking the time, the energy, and the passion to share the best I’ve got on this website.

And you for still having the privilege to choose what to read, without any imposition from your government, your social condition, and virtually no limits to build your future…

This is not granted to anybody, think about it). 

Read more  : Wait a minute, what age should I start saving money for retirement?

But Why Is It Important To Save Money?

Here, let me answer with something that you could have not considered so far. And this is something that comes from my direct experience : having enough money set aside maybe won’t make you happy (depending on your view of life and your expectations)..

But it can for sure buy you TIME, SPACE and OPTIONS.

Bear with me and let me explain : 

TIME

When I was a youngster, I was short on money because I was trying to figure my future.

I was trying to understand what specifically I wanted to do with my life whlile also attending school.

(Aha! My school path was actually kind of weird but I will talk more about it in another post 😀).

But on the other hand, I had plenty of free time in the afternoons. Time with which I could have done much more if only I’d known better…

As my age moved ahead and life took his directions, I found myself able to increase, sometimes dramatically, my income,

But trust me, I paid it all with my time and energy, and I still do.😒

Now, the money I set aside during all these years, brought me to the position of now having again free time enough to cultivate my passions.

Including that of contributing and reaching out, and this blog is a part of the result.

I was always passionate about Trading and Investments.

Now, I am terrible at trading, but pretty solid at managing my wealth…

If I had done worse, now I would be forced to take another additional job to provide for all the expenses a family like mine has.

No time left for anything else. Period.

SPACE

Again, as a young guy I went away from my parents rather young and without a day job to make a living.

I was fresh from school, and at the time it was really challenging to find a paid job.

Let alone even thinking to rent a flat…

So I slept in my car for some weeks (thank god it was summer!).

Then a friend of mine allowed me to sleep for a couple of months in a bed next to his in his bedroom (I will never thank you and your family enough, Donatello <3 ).

Those days I worked like a dog in a bathhouse, 13 hours+ a day…

Then summer went by, the bathhouse closed and I ended up finding a gig as a teacher in a guitar school.

(that later I found to be a multi-level marketing system to recruit students!!😲).

Anyway, my salary there was enough to finally pay for a small room in an apartment with roommates.

…do you see the pattern here?

Today, after decades of work, me and my family are in the position to afford the rent of a circa 100mq flat (approx. 1076 square feet) in Germany.

And this comes after owning a portion of a duplex that we sold in Italy…

Yes, the money allows us to afford it, and we could now afford even more if we needed to.

You can transpose the same concept to a workspace.

You could afford a bigger, better-furnished area, with better technological facilities, simply because you have the money to pay for it.

See? MONEY is involved here too! What a surprise….😂😂😂

“I slept in my car for some week (thank god it was summer)…”

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OPTIONS

Yeeeahhh!! I love this one!!!! Let me try to explain it as down-to-earth as possible. 

Stay with me here, this is F***ing important!!

Say you are starving and you need money to eat. Of course, you will accept any kind of work you are offered because you have no choice (= you have no options).

It happened to me as well, eating tuna from a can as I lived on teaching guitar privately and a single live gig a month in a local club. And things can get worse rapidly if you have a family and kids to provide for. A solid emergency fund capable to cover the expenses for a few months is an excellent options generator!!

If you do not have the hassle to find a way to survive right now, you can evaluate with much less pressure…

The possibilities you find along your journey are endless. And you deserve the right to discard them all, and even create new ones from scratch yourself.

Just as an example : me and my family are now in a position where I could stop working altogether for years, without this compromising our actual lifestyle at all.

(Please understand I am not trying to brag here, I won’t hide the fact that it was really tough, I just want to assure you that this can be done.)

And, to complete my argumentation, now you can understand the following :

If I still hear somebody claiming that “money is not important after all”, I run like hell away from him!

Wealth=Happiness??

Hey, of course wealth doesn’t guarantee happiness.

But I still have a difficult time figuring out somebody trying to reach happiness and peace while starving to death and sleeping under a bridge.

Or, to stay with both feet on the ground, wouldn’t the abundance in your family bring also less anxiety?

Aren´t more comfort, and the ability to support your kids designing their future appealing to you?

Let me know your opinion in the comments!

Read more  : How Much Money Should I Have Already Saved By 21 ?

When Is it Ok Not To Save Money?

Savings…

If you think about it, we are supposed to save money to have some protection for the “rainy days”…

And only then build some more to spend on goods or projects, right?

But as a young individual, you should instead have plenty of projects up front. And believe me, you should take your best one and try to bring it to reality right now!

This is because If you are still staying with your parents, you are in your last years of schooling or you have had your first day job for some time already…

…well, this is not the moment to save!

This is your best chance to invest in yourself and your ideas, start a business or build yourself in a world-class professional in your area of choice.

This is the moment to try it all and maybe screw it all!

Then start again with the accumulated experience and possibly screw it again, but stubbornly go for it and make it work in the end.

It is a state of grace where you can be brave and learn a whole lot while not risking going homeless…

So the bottom line here: it is ok not to save money when you are investing it in your future.

Are There Better Options Instead Of Saving MoneY?

Yes there are…if you are interested!

Though the mere activity of saving money will bring you miles ahead of the masses it definitely won’t “make you rich”!

(but it will teach you for sure some vital discipline and “smart spending”),

Let’s make some clarity on the term “rich” here : it is not about swimming in money like Scrooge McDuck…that is pointless.

In my book, you are rich when you:

• are in charge of your time.
• can afford any space you can reasonably need for your comfort.
• can evaluate and choose from a large number of options to design your life and make it really a memorable experience.

Simple real-life example : you can define yourself as rich if you can sleep some more in your bed every day if you want to, not only on weekends. You can afford to think and refine an idea you have for weeks or even months without the pressure to produce money to feed yourself and your loved ones.

You are rich if you can move to different locations with just a little bit of planning for your convenience, and afford clean rooms whenever you go.

A Solid Alternative

Ok, we are done with the definitions and we are on the same page. Let’s move on :

Yes, saving money can be a crucial part of personal finance.

This is often seen as the go-to option for anyone looking to secure their financial future, right?

But it may not always be the best option, especially in the current economic climate…

Bear in mind that money doesn’t have a brain (Ow…that was brilliant, isn’t it??…). It cannot decide on your behalf what is the best move for you right now.

That said, here are some potential alternatives to saving money that you may want to consider in 2023:

The classic option to consider instead of saving money is Investing.

While saving money simply involves putting money aside in a safe and secure place, investing involves using that money to purchase assets that have the potential to increase in value over time.

This can include stocks, bonds, real estate, or even small businesses. While investing carries its own risks, it also has the potential to yield much higher returns than simply saving money.

It wil beat traditional savings accounts or money market funds, if you know what you are doing.

but why not…

Invest in Small Businesses?

you can even get more advanced and do what the very few make:

Research and consider investing directly in small businesses. It involves a totally different set of skills as opposed to stock purchasing or selling,

But those will hold solid value and serve you well for years, especially if you then start a business yourself.

Or you could focus yourself paying off debts instead. This possibility is always overlooked, but if you have high-interest debt, such as credit card debt or student loans, paying it off can be a better financial move than simply saving money.

This is because of the interest you pay on debt. It is pretty easy to let them run out of control and quickly eat away at your savings.

This will make it impossible to build up a significant amount of wealth over time. That´s why focusing on paying off your debt first could be your smartest move.

You can free up more money to save or invest later on, while learning a priceless skill at the same time.

(Never let down the chance of learning. I cannot stress this enough…)

Protecting Your Downside

Another option to consider is building up your emergency fund. While saving money is a good way to prepare for unexpected expenses or emergencies, several contingencies could ruin your plans.

It could be then more effective to build up a dedicated emergency fund specifically tailored for this purpose. This can be a separate savings account or a short-term investment that is easily accessible when you need it. Having a solid emergency fund in place can give you peace of mind and help you avoid having to turn to high-interest credit cards or loans in the event of an emergency.

And what about investing in…

buying or developing Digital Real-Estate?

Digital real estate refers to the ownership and management of online properties, such as websites, social media accounts, and mobile apps. These properties can be used for various purposes, including generating revenue through advertising, selling products or services, or providing information and resources to users.

Nowadays, digital real estate represents a significant business opportunity.

But Individuals as Entrepreneurs can build and monetize online properties. It is a rather new thing and thus competition is still relatively moderate.  By effectively managing and promoting digital real estate, a committed individual can achieve significant success and reach a global audience thanks to the power of the internet.

And finally my favorite one!

Investing in yourself is the way to go to improve your skills starting from now.

You are going to :

• dramatically increase your earning potential
• open up to new opportunities you just wouldn’t be able to see without that specific knowledge. 

If saving money can provide some security and stability, investing in yourself is the path to achieving long-term financial success.

Expand the way you experience life, or very simply build yourself into “your very best”.

Read more : Why Is It So Hard To Stay Productive ?

Conclusion

In this article, we explored deeply the meaning and value of saving money in a complex world environment like what we experience today…

I provided a very personal (and perhaps non-conventional) view of the real practical advantages of putting money aside, as well as the reasons for not saving money under specific circumstances.

We expanded then in a number of specific alternatives to the simple act of saving.

Some can complement it, and some have the potential to blow your returns to heights you could not believe.

While attending a financial trading bootcamp years ago, another attendee made a very interesting point regarding one’s ability to manage money and wealth in general :

And this assumption proved to be 100% accurate:

The more wealth you control, the better you become at decision-making and holding emotional recklessness under control.

This is even more true if your wealth is the result of years of slow and patient building effort.

So, in conclusion: saving money is certainly a healthy, positive financial strategy.

But there are other options that you may still want to consider (Investing, paying off debt, or again building up an emergency fund).

Listen, I sincerely hope to have somehow reached your calm, intelligent, best Self, and brought him curiosity and interest in investing in your education or professional development.

To me. all the others are good complementary alternatives. They can help you move towards financial security and reach of your financial goals according to your personal situation and objectives. 

(Oh, and by the way, Argentina won the match against France at penalty shootouts in the end…oh my my…😀😀😀)

All the best. See You all in the comment section!