Saving is a one topic that no one likes to talk about.
According to my English Dictionary, “Saving is a reduction in cost or expenditure”. I see savings as the ability to set aside small amount of money for days that aren’t so good. I believe most people did Economics and must have been taught a little about Money. I also don’t think you need Economics to decipher what money is all about.
To a layman, money is what we use for the exchange of good and services. Money is primarily why goods and services are being circulated. But Money goes a really long way and it is beyond just normal exchange of goods and services. Money is not just meant to sit down in one place. I started to really understand that money is beyond having value to spend at launch at my Economics class in SS1.
I was made to understand that money had three motives. I never knew why everything had to be so complicated then. But somehow I made it through every economics with a distinction. I believe, sometimes, that Age and Time has something to do with the way and manner we take some things seriously in life. That has been my experience so far. I am not here to drop a big bomb shell but I am here to shed some light that I believe will be helpful especially with the fact that you are young. It good to start early and in fact that is very helpful.
I see savings as a form of discipline that everyone could do if they really set a goal. And this goal must be in writing because what you don’t write you cannot be held accountable for.
I don’t know if it a writers thing to do or maybe it is tagged as normal but I do believe in writing things down. That is how students can pass and study for an exam. This is a crucial part of any student that has a goal. A goal should be written down somewhere before it can become a reality.
In Economics, there is a Transactionary, Precautionary and Speculative Motive reason for holding money.
The grouping into these classes has made it easier for people- you and I to be able to plan ourselves around these motives. I would go on to explain a bit more for people that really don’t know the categories of money.
1. Transactionary Motive
This is what you spend every day for your daily expenses. For your small buying that you really cannot do without every day. For instance, transportation to school is an essential amount that you cannot do without. It is transactional, and you must transact with it every day whether you like it or not.
2. Precautionary Motive
This is the money that you set aside for things that are not planned for. I don’t really know if I should shed more light on this or if I will be able to hit the hammer on the head if I talk about this. Not all teenagers come from a well-to-do family and even children from wealthy homes can learn a thing or two from this. It is definitely not all the time that you can ask your parents for money.
I learnt this early because I stayed with family for 5 years and asking your Aunt or Uncle for money all the time isn’t that easy, so I had to develop the culture of saving. I had to deal with some school projects on my own. Not because my Aunt or Uncle couldn’t afford it but because I was always tired of talking that I needed this or that. Because I was tired, I had to do something that worked for me from SS1 – SS3 and I must say, it wasn’t easy but it helped me a lot.
I started to slash my lunch money into two. It wasn’t much but I was also not starving by doing that. I was able to keep some money aside, so that when some important things like my period, school practical fees and the likes came in, I could always work my way around them.
Before I go on to talk about the speculative reason for holding money, I would go on to say a thing or two that will work for you when it comes to saving.
A. Set Realistic goals when it comes to Savings
If your goal is to save #300.00 per week, you can do it. Nothing is too hard, as long as you set your mind to it. You are not starving yourself, you are simply cutting off unnecessary cost. If in your normal lunch break, you spend #500.00, I am not saying it is too much or it is even enough. However, if you really look at it, you will realise that majority of the things that you buy are just junks that could be detrimental to your health. So, Kill 2 birds with 1 stone.
Saving is not a punishment, it is also not meant for only adults. You can do it.
If you set goals, you the ones that you can do and that you know will push you a little bit more and be beneficial to you. Write them down and look at them daily, so it will be like something you have to look at when you wake up. It works for me but I break mine into something that I have to do daily. I break my big goals into sub goals. For instance, if by the end of the month, I need to have saved #20,000.00 I work daily to collect that money into tiny collectibles so that by the end of the month, it will round off to #20,000.00 or more.
B. Be Selective in your Spending and be Deliberate in your Savings
There will always be that nice thing you need. There will always be things that are flashy but the goal is to starve your distractions and feed your focus. This can only work if you have friends that share the same vibe as you.
The bible also contributed to saying, that if you are associated with the wise, you will be wise and the companion of fools shall be destroyed.Proverbs 13:20
If you associate yourself with a shopaholics trust me when I say this, your saving culture will be Zero. You need Wisdom here and I pray that you have it.
I hope you are still following me. Let me dribble down to speculative reasons for the demand for money.
3. Speculative Motive
I know some of you might not really follow here but let me say as little as I can here. You have demanded for money for your day-to-day expenses and you have also demanded for money for precautionary motives, that is, for contingencies. Now, the last on that list is to demand for money to make profit, to invest and to buy asset. In this category, the money is meant to make profits; to go round and come back in folds.
If you consider money as a resource, you will utilize it well, in terms of its high monetary value.
Do you already have a saving habit or currently working on it? Do leave a comment below and don’t forget to subscribe to this blog to not miss a post.