# 3 bad excuses for not saving money

If you want to be rich, you need to invest in capital. Judging by the statistics, think about it less and less people. In 2005, the United States for the first time since the great depression have had a negative savings rate. So why people do not save, even living in a fairly prosperous country?

Present a short list of the most popular and frequent excuses that people explain their debariloche. Although we should pay attention to the question, how to save money and plan expenses.

### 1. I’ll do it later

This excuse all young people and probably it is the worst. A young man in his 20s thinks: «I Have 60 years ahead in order to save money, but now I should enjoy life». If you now 20 years, it’s time to save money. You have a lot of time to increase your wealth. Start saving from an early age and you will be able to save a large sum, and then multiply it. In the end, the accumulated capital will always be more than if you start saving money later.

To show an example of how the interest rate behavior of two people — Jack and Jill. Both of them are 22 years old, and both have the opportunity to save \$ 2,000 a year. Jack takes his savings of \$2,000 and puts them on the account with a 12% rate. Jill spends his \$2000.

Jack saves \$2,000 a year for six years and after this no longer saves. And Jill, she spends \$2,000 a year for six years, but then decides that she needs to start thinking about the future. She finally opens an account with the same 12% rate, which already has a Jack. Jill invests \$2000 every year until she turns 65. Below shows the profit Jack and the appropriate account Jill the moment when they were both 22 years old. Remember that Jack had invested only \$12 000 , while Jill invested \$74 000.

 Age Jack Jill 22 2240 0 23 4509 0 24 7050 0 25 9896 0 26 13083 0 27 16653 0 28 18652 2240 29 20890 4509 30 23397 7050 35 41233 25130 40 72667 56993 45 128064 113147 50 225692 212598 55 397746 386516 60 700965 693879 65 1235339 1235557

In the end, both Jack and Jill were able to get the same amount, but Jack saved less. Imagine that Jack would have continued to save \$2,000 a year, and then, once passed these six years! Then he’d become a millionaire within a couple of decades!

### 2. I do not earn enough money to save

If you get a salary, in any case can save. It doesn’t have to be a very large amount, start small. Take it a rule to save 5% of any income, and then Deposit this money into a savings account with a good percentage. You will be amazed to see how quickly small contributions can accumulate. Gradually increase the share of savings up to 15% of their income. Whenever you get a 13th salary, put half the money in the Bank. Slowly, gradually, saving money, you will be the owner of a capital good.

### 3. I deserve a little luxury

Many people do not save money, spending it on expensive «toys» in which they actually do not need. In this case, the justification goes something like this: «I’ve worked hard and deserve praise and rewards.» Personally, I struggle with this excuse right now. I really want to buy Macbook, I have the money for it, and can easily go to Apple Store and buy what I need. To ward off the obsessive desire helps me to the following thought: I earned that money from hard work, donated their time and entertainment, but could finally save a decent amount. Do I really want to lose \$1000 of savings, spending them on something not really needed? This is a bad way.

Instead consider things as a kind of affordable luxury, think about saving, and saving as a luxury. When you save money, give yourself the amazing luxury of financial freedom. Because you will reach a point when you do not have to worry about money! It’s just an amazing freedom.