How to allocate savings

Once we are clear that saving is important, it's time to get down to work and deliver savings. It is important to remember that the money we save is to spend at different times in our lives, which will allow us to save is to spend without reducing our standard of living.

The first step we must take is, if we have not already done so, save for unforeseen or unexpected expenses (eg car repair, purchase of appliances for damage, home repair, etc ...). It is what we call SHORT-TERM savings. Such savings will allow us to basically two things:

1. Quietness: having saved some money will allow us to "unconcerned" with these unforeseen circumstances and not to address them into debt.
2. Will allow us long-term savings without living a day.

The second step is to create another type of savings, MEDIUM-TERM SAVINGS. The purpose of this saving is to address those costs than expected for within 3 years or more (eg, change of car, study, travel, etc ...)

The third step is to create a LONG TERM SAVINGS. The purpose of this savings is primarily supplement our retirement (discussed later), pay off the mortgage or send our children to study in universities abroad.

Although they are numbered from short term to long term, the most important is the long-term savings and that we should begin to undertake as soon as possible, because time is on our side.