Growth & Jobs | Save so you can improve your quality of life

“Maintaining savings can improve the quality of your life in a number of ways,” says Rose Miller, manager for strategic empowerment programmes at the JN Foundation.

“Once you are saving and doing so consistently, then you’ll find that your finances are going to improve. And this will bring you freedom and a certain amount of flexibility. Freedom, because you are better able to make choices that align with both your goals and values,” she explained.

OPPORTUNITIES TO INCREASE WEALTH

“When you have sufficient finances, it improves your chances of seizing opportunities. Some of which can also help to increase your wealth. For example, opening a business, investing in your education or acquiring new skills; and all of these actions will ultimately help to improve your quality of life,” the financial literacy specialist pointed out.

ACQUIRING ASSETS AND INVESTMENTS

In line with her thought on creating wealth, Miller noted that savings are very useful when seeking to acquire assets, such as a house, as there are several upfront costs that the buyer has to come up with out of pocket. “Also, having a pool of savings provides a springboard for moving to the next level,” she said.

“Once you have saved, you must graduate to investing, as this is where real wealth is created, because you get more returns, and therefore improve your financial status. But, without savings, it is harder to start your investment journey,” she added.

IMPROVED HEALTH AND PEACE OF MIND

Developing a habit of thrift also has health and social benefits, the financial literacy expert indicated. Being ‘financially well’ can reduce feelings of anxiety and uncertainty, she said, and promotes peace of mind, good health, and wards off stress-related illnesses, such as high blood pressure, stroke and depression, as persons are better equipped to deal with their financial obligations and take care of emergencies.

BETTER RELATIONSHIPS

Financial stability also reduces pressures that could lead to the development of unhealthy relationships.

“No one wants to be around someone who is always miserable,” she laughed, noting that financial uncertainties can impact mood and behaviour negatively, a consequence of which could be a breakdown in relationships. “Money in the bank frees you from emotional and mental struggles associated with lack of finances, and these individuals usually have a more positive outlook on life and, consequently, better relationships.”

HOW TO SAVE

But how can one save? Miller said that there are some prescribed steps one can take to get started.

“The first step is to identify the goal, ask yourself, ‘What goal am I saving towards?’ then figure out how much you need to save, and for how long, to achieve that goal. Creating a budget which includes this saving goal will significantly improve your chances of success. Save before you spend.”

She advised that an easy way to get started is to automate one’s commitment.

“Take it (the amount you want to save) out before you see it. Ideally, we want to be saving at least 10 per cent of what we earn. If we want to save more, great,” she noted. Recalling a quote from US billionaire Warren Buffet, “Do not save what is left after spending. Spend what is left after saving,” she advised.

She encourages Jamaicans to save so they can realise their goals and improve their quality of life. At the same time,“take steps to improve your level of financial literacy,” Miller urged.

She said financial education is important to developing better habits for all Jamaicans, and urged people to seek out information to improve their skills, knowledge, and behaviour towards money.

“We want Jamaicans to take control of their finances and become financially literate and savvy, so that they can lead better lives.”