Before investing, you need to commit to a saving strategy. First, it is important to know how you plan to save.
One of the most popular saving methods is the Income – Savings = Expense method. In this equation, you tuck away your target savings money straight out of what you earned and spend what’s left of your income. This is in contrast to the Income – Expense = Savings method, wherein you only save whatever amount is left after deducting your cost of living expenses from your income.
Whichever saving and budgeting strategy you choose, use your savings money to invest. Some people save and then let their money sleep in their savings account. While there’s nothing wrong about this, the opportunities to grow your money through investments are not explored. Developing a habit of saving just to save is good, but saving to invest is better to make your money work for you.