We all like the idea of a big savings account, but what are we actually saving for? If you like to have a goal in mind or you’re not sure what you need to have savings for, here are five things to start putting money aside for right away.
No matter how old you are, it’s the right time to start saving for the end-of-life expenses. Not only can the last few years of a person’s life be extremely expensive, but you’ll also have to worry about cremation costs or funeral expenses. A funeral can cost you thousands of dollars, and if you pass away, you don’t want to leave your family with that huge expense. Start setting aside money now to cover the costs of cremation or burial, a funeral, and the related fees that you might not have considered before.
Depending on where you live, the average price of a home is anywhere from $108,000 to $636,000. While it’s possible to get a home with a small down payment, the more money you can put down, the better off you will be. Use loan calculators to consider how much you should be saving for a home in your area and start saving right away. If you already have a house, you might want to start saving for the next one. While you’ll get money from the sale of your home, any additional funds could be a huge help in getting your dream home.
Similarly to a house, you want to put as much money towards the purchase of your car as possible. You want to avoid loans whenever possible, and while that’s normally not an option when purchasing a home, it can be an option when buying a new vehicle. Save up enough to cover all or most of the purchase price. Since cars’ values depreciate as you buy them, you’ll be in a much better place if you purchase it outright. You can then start saving for the next car instead of paying off the one you’re currently driving.
Your Child’s Education
More than 44 million Americans currently owe money after taking out student loans. Being burdened with this debt can make it impossible to save for a house or a car, and some people find they can’t even afford to pay their rent. Give your child the gift of freedom by saving for his or her education right away. Even if you don’t have a kid yet, start saving now. Being able to pay off your child’s education and prevent him or her from taking on debt will make you feel fantastic, and your kid will have a huge leg up in life. If you want to take care of your children, start setting money aside for their futures.
Weddings can cost more than a new car, so start saving now for this major expense, no matter whose it is. If you’re not already married but are planning on having a wedding, start putting money aside for it right away. If you’re already married and have children, put money in a savings account for your children’s weddings. A wedding is a huge event in a person’s life and it can cost an enormous amount of money. Make sure you or your children have enough money to pull off a dream wedding without going into debt. Also, don’t tell yourself that the guests will pay for the wedding. You still have to pay for it upfront, and you might not end up with as much money as you were hoping.
It’s always a good time to start saving. Keep these five things in mind and set yourself and your family up for a financially healthy future.