Saving Money Is The First Step Toward Financial Freedom.

A lot of financial advice says not to save. This is actually doing people a huge disfavor.

Everything has a process, including learning how to invest and start making riskier moves and begin making money from money.

A lot of personal finance advice that I hear on social media is about investments and the different vehicles you can put your money into so you can begin making more money.

As helpful as this may be, it doesn’t help by dismissing the most basic aspect of financial literacy:

Know what goes into your pocket, know what comes out, and make sure every month, you’re making more than you’re spending.

If you don’t know what you’re making, what you’re spending, and what’s available after your expenses have been paid, are you really moving forward?

Here’s my point:

If you don’t first learn the basics, how are you supposed to master the more complex, nuanced aspects of personal finance?

To be able to start investing your money and begin creating a nest egg that will carry you through your golden years, it’s important not to dismiss the simple yet powerful movement that is saving.

Don’t dismiss advice or tips that teach you how to save money. After all, you need to first have some sort of savings to begin, well, anything.

As I mentioned in another blog, I have reached my savings goal of six months of expenses.

Some will tell you that keeping this amount of money in a savings account is a bad idea.

But I disagree because I’m not a fortune-teller who can tell you with 100% certainty what will happen in the next year.

I can’t even tell you what’s going to happen today.

So to be on the prepared side, I choose to have a cushy emergency fund.

The most important aspect that will carry you through any financial situation, good or bad, is how you steward the resources you have.

This leads right to my next point.

Stewarding what you have now will open the door for more in the future.

They say with great power comes great responsibility. I don’t know who they are, but they’re right.

About a year after graduating college, I got a new job, this was about two years before the pandemic.

I was given a salary, and it was the most amount of money I had made in my life thus far — I was twenty-two at the time.

What I was making then is pretty close to what I’m making now, and boy, was I excited.

Looking back, although I did make good use of the discretionary income I made — money left over after expenses — I could have done A LOT better.

Now I realize why.

I did not track my income and my expenses the way I do now.

Back then, I used the majority of that extra money to pay back my student loans. Good use of the extra resources, for sure. But I could have done more and better.

I could have moved out. I could have bought a new car. I could have built a better emergency fund that could have carried me through my lay-off.

I could have done a lot of the things I thought were faraway dreams.

Why didn't I? Because I hadn’t learned to be a good steward of my resources.

It wasn’t until I started tracking every dollar I made and spent that I was able to create clear and achievable goals.

Here’s my budgeting method. It’s very simple:

Oddly enough, once I got into this habit, I was given opportunities to make more money.

I believe this was a gift from God because He knew I was ready to handle more and could be entrusted to handle it better than I had done in the past.

Ultimately, I was able to move out and currently live financially independent in New York at the age of twenty-seven.

Something that’s come to be a feat for most people in their twenties.

The lesson I learned through this is you can only make the most of what you have if you know exactly what you do have.

This is probably where most people fail in their finances. They don’t have a clue what they have.

This is why it’s so crucial to track your cash flow.

You don’t question whether, at the end of the day, week, or month, you’re going to be okay.

You know you will be because you’re aware of how you’re money is taking care of you. Or is it how you’re taking care of your money?

Either way, you’re fine because you’re in control.

You know ahead of time whether you’re on track to reach a goal — You know more or less how much time it will take you to reach that goal.

This is how I was able to achieve my largest savings goal.

The good thing is now, any extra money I make, I can do whatever I want.

I am sensible and will begin investing more aggressively now that I have an emergency cushion.

But the point is just that. Build an emergency cushion so that you CAN make those riskier moves. If anything falls through, you will have a safety blanket.

Imagine skydiving without a parachute. No one would do it.

Yet thousands, maybe millions of people, are taking huge risks with their money without any savings to protect them in case anything unexpected happens.

This is why I believe saving is a powerful tool. It’s the stepping stone to getting you started on your financial freedom journey the right way.

Please be advised I’m not a financial professional. This is for information and entertainment purposes only. If you need help with your financial situation, please contact a licensed financial professional.