The main reason for having a savings is to attain financial freedom but the truth is that it goes beyond just putting some money away for rainy days.
What you do with your savings goes a long way in how much difference you can make, which is why you need to be smart with your savings.
Here are things you should never do to your savings.
Dipping into your savings can be very tempting especially when you find yourself short of cash. Set a saving target for yourself and discipline yourself not to touch it until that is achieved.
Loan it out
Never loan out money from your savings to family members or friends. You can loan out money from another money source but not from your savings. Giving out loans is a risk because you cannot guarantee if the other party will pay back so loaning out money from your savings is not a smart move.
Never invest your money in something you know nothing about. Before you decide to invest, do some research and get knowledgeable. You didn’t save so that you can gamble it away. Take calculated risks and don’t be greedy and start looking for ways to double your savings.
Give it out
You should be financially independent before you decide to become generous with everyone and toe the philanthropic path. Build your wealth first and then you can contribute to the society.
Leave it for so long in a savings account
Why leave your money in your account when you can use it? It’s good to save and all but putting your savings for too long in a savings account without doing anything meaningful with it is not the best. Find profitable things you can do with your savings when you have enough. The real value of money would have gone down in a few years because of rising prices.