Best Time To Build Up Your Savings

Have you ever given a thought about when is the best time in your life to build up your savings? Let’s look at the various stage of our life-cycle.

1. SCHOOLING
When you are still schooling, you are dependent on your parents for allowance. Unless you are born with a silver spoon, more often than not, the allowance is barely enough for food, transport and occasional outings out with classmates.

2. STARTING OUT
Around early to mid twenties will be the time most of us start working. You will likely have to take care of your own expenses, like food, transport, handphone/internet and miscellaneous like yearly tour with friends, eating out, clothes, etc. Parent may expect you to help contribute to family expenses.

3. GETTING MARRIED
When you are ready to settle down, sudden high expenses starts to come in. First and foremost, diamond proposal ring. In reality, some guys told me that they’ll buy a proposal ring (with a price tag somewhat close to “twice your current monthly income”.

You’ll also have to set aside cash for wedding package, booking of hotel/restaurant, honeymoon packages, downpayment for your house and renovation expenses. This can easily add up to a ten of thousands of dollars. If you have not saved enough for this stage, your debt will start to build up.

4. HAVING A KID
When you/your spouse is expecting, visits to the gynae, baby stuff, supplements for the mother and hospitalisation bills are essential and unavoidable expenses. IT IS DEFINITELY NOT CHEAP. (I’ll share a breakdown of how much I have spent on this aspect in my blog later).

Finally, when the baby is delivered, milk powder, diapers, supplements and most of all, babycare/childcare arrangement will start eating into your pay.


CONCLUSION
So when is the best time to save? In my personal opinion, it is when you are just starting working and still staying with your parents. Granted that your starting salary may not be high, if you can manage your expenses prudently, you should still be able to save up considerable amount before you move on the next stage of your life. As you progress on, there will be increasing expenses that are more difficult to control.

For guys, I realised that after working for 1-2 years, most guys will start looking for a car. I guess it is easier to court girls or if you are attached, to chauffeur your girl around. It’s a nice feeling and tons of convenience being able to go anywhere you want, anytime. Do evaluate if this is a need or a want.



Bear in mind, this will also be the time when you are approached by friends/acquaintances who are insurance agent/financial planners. [I will discuss this aspect in my blog later]. Looking back, I realised that I bought a lot of unnecessary policies during those days which I subsequently cancelled coz over time, I realised that I actually do not need these policies. In hindsight, the money spent could have been better channelled into investments. Oh well....

In my opinion, the best time to save was the time when I was still single and staying with parent.