Consequences of Not Saving Money

Many Americans struggle to save money but it’s worth the effort since there are serious downsides to not stashing away cash. These can range from going into debt, facing financial hardship after losing your job, and not being able to achieve your aspirations, like homeownership.

To help you get motivated to put money in the bank, here are twelve dangers of not saving money. They may help you understand why it’s best to put away cash and motivate you to tuck some into a savings account.

Going Into Debt

Without a savings cushion, any expense—from an unexpected car repair to paying for your child’s college education—can put you in debt. In addition, while credit cards and loans are convenient ways to afford more than your bank account, you pay more in the long run because of interest and loan fees.

Not Having the Money for an Emergency

Building an emergency fund might be a better choice than splurging if you get a raise. You’ll thank yourself later when, say, your furnace goes out or you wind up with a major medical bill.

Not Being Able to Celebrate Events

Celebrating these life events with your family often takes substantial cash. Not being able to recognize these events the way you’d like to is another one of the many dangers of not saving money. The lack of a financial cushion could also lead you to skip, say, a friend’s destination wedding.

Not Having an Inheritance for Your Children

An inheritance can help your children or heirs to build their nest eggs and meet life’s expenses without stress. Having both savings and an estate plan can be a lasting, life-changing gift to those who matter to you most.

Not Being Able to Buy a Home

Buying a home also usually involves other expenses, such as closing costs, repairs, moving costs, and more. Not having savings can make it almost impossible to afford the home of your dreams.

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