The Habit of Saving
The habit of consistently saving a part of what you earn is a fundamental principle of most, if not all, approaches to building wealth.
Let’s say you save 10% to 20% of what you earn, systematically. In the long run you can accumulate far more than the sum of what you saved every month, if you invest it wisely.
But that habit may be read differently from other people’s perspectives:
- Some may see it as being a petty habit. You sacrifice the present while thinking of a future that may never arrive. You don’t take the best life has to offer.
- Others may see it radically different. You seek an abundance of money and of time, security, leisure, learning. Financial independence.
I see it the second way. But most of the time I feel judged by people who adhere to the first way of thinking, which for me is very limited, suggesting an immediate and consumerist mindset.
I believe that, when you save a part of what you earn, you are paying yourself. When you don’t, you pay everyone else but you.
That’s because, that amount you are saving, it is going to work for you. By consistently saving a part of what you earn, and investing it appropriately, you can succeed in many ways. In my case:
- I can offer security and stability to my family;
- I can face temporary adversities of our capitalist life far easier (crisis, unemployment, accidents of any sort, etc.);
- I can avoid debt, if I want to, when I wish to conquer bigger goals;
- I can invest in learning, which will improve my earning capacity, as well as my saving and investing capacities, proportionally;
- I can more easily embrace opportunities life puts in front of me;
- I can offer more and better opportunities to my family (traveling, school, university, etc.);
- In the long run, I can have far more than I would be able to by living without the habit of saving.
All that is about an abundance of security, flexibility, opportunities, and freedom. It takes effort and discipline. It is not easy but it is certainly worth paying the price.
If you want to learn more and get inspired about the habit of saving and building wealth, you may want to read The Richest Man in Babylon by George Clason.