Save or Spend

People usually say that they do not save because the money is to spend and to be lived daily. I save because this way I will be able to spend more on and I do not want to borrow.

The differences between saving and not saving:

1. Mortgage

• Savings: allows me to buy a home, I have to pay the mortgage costs and a major gateway that allows me to apply for a loan you can afford without relative difficulty (Euribor up or not). This is the most efficient way to buy a house and save € 60,000.

• No saving: I have to get a high mortgage, because I barely saved to afford the down payment and I have saved practically nothing to give any money. Consequently, my mortgage fees will be higher and, therefore, to be more affected the interest rate will be worse.

2. Buy Car

• Savings: I bought the car as explained with my savings. So I do not have to get a loan.

• No savings: Since I have no money I ask for a personal loan, so my standard of living will decline in coming months to repay the loan. Besides, I have to pay a lot of interests for the loan. Finally I also bought a car, the difference is that I'll be drowned out by a loan.

3. Holidays 

• Savings: There is an easy way to go on holiday every year. I have to think about where I'd go in August next year, according to a budget that will more or less. If it costs, for example, $ 1,200 go on vacation, it would be enough to save $ 100 every month to reach that amount. Therefore the extra wage will be for the summer and would not go toward the holidays.

• No savings: As I have not planned my vacation, at best, my salary is going to pay my holidays and in the worst cases, families who borrow to go on vacation or who pay by credit card, deferring the payments. Break is over and I am 12 months after repaying the loan or paying the amount of the credit card.

( Here you can see how to save € 2,000 reducing your debts and teach you here to fight your loans, credit cards and mortgages )

4. Retirement

• Savings: I am aware that I have to save for my retirement and the sooner you do, the more wealth I get.

• No savings: since money is for spending, I do not save for retirement, there will be time and I will do later, when retirement begins to worry me (I am 35 years, there are 30 years left!) . In addition, I have a mortgage now I am paying a personal loan. The problem is that when you decide to save (typically, you will begin when the retirement is so close), I will still have my mortgage, maybe I will  have children and I would like to send them abroad to study and I will have just bought another car (with a loan, of course.).