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Habits in Saving and Investing for the Future

January 6, 2017 by  
Filed under blog

For the average person, the key to wealth is summed up in that simple little thing called ‘savings’. Saving can also be the key to peace of mind such as in that old phrase “Saving for a rainy day,” which means setting money aside in case of an emergency. Saving up money is just a very smart thing to do and the new year is a great time to really get serious about that and your financial life.

Your financial future begins and depends on the idea of savings. Even those with small incomes that are living hand to mouth, thinking “we are just barely breaking even,” will need to save. Yes, it can be tough to save a little money from each pay check but with good planning, some self-discipline, and giving up on things that you thought you couldn’t live without, setting a little money aside is very possible. Yes, you may have to come up with a very tight budget and forego eating out at your favorite cafe and not buy that shirt or dress that you want so badly, but the rewards are so very worth it. In the long run, a little savings can amass a very large net worth and even a fortune, plus a good deal of peace of mind.

But saving money is just part of the big picture. As you are building up your financial nest egg it’s a good idea to keep your eyes open for real estate deals that look to have great potential, even when know your savings is not near enough yet for a down payment. And yes, I am talking about and recommending those fixer uppers and dirt bag houses or apartments that need work but whose value can be greatly increased. Keeping your eye out for those bargains is a great habit to get into. You can even make offers when you don’t have the down payment.

But why, you may ask, would you do that when you don’t have the down payment? Well, first of all, it’s a great way to work on your offer writing and negotiating skills and, second, if you really do find and tie up a great bargain there is always the real possibility that you can go find a partner to put up most or, sometimes, all the money with you still owning a percentage of that bargain.

When I first started my saving and investing plan, I very quickly saw the advantage of making offers with that good old “subject to” clause which allowed me to back out if I couldn’t get the down payment or finance it. This gave me a lot of practice and, yes, I even landed a couple great bargains and brought in a partner.

So, if you don’t have much money but want to get started, begin by saving as much as you can and get in the habit of looking for those bargains. Also, you might want to pass this kind of information and strategy onto your kids, grand kids, or friends that you know are struggling financially. This kind of thing may be just what they need to get focused and find their way to financial freedom.

It’s also smart to take the time to really study and fully understand the incredible power of financial leverage and then what compounding your money can do, even when you start with just small amounts of your money. When I saw what leverage and compound could do, it turned me on and motivated me to a super high level and pushed me to save even more money and cut back on most everything.  Anyone can do the same thing.

So, as we start this new year, consider saving more and looking into bargain real estate as one of your great new year’s resolutions!

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