Tuesday, June 15, 2010

What Am I Saving For?

Saving money is good.

But we need to know what we are saving money for.

Is it just to see our bank accounts grow fatter? Do we have a clear purpose in our savings?

We can choose to spend our money today. Or we can save it up and spend it tomorrow. When it comes to saving, we need to know why we are not spending the money today and instead saving it up. I am writing this post to tell myself why I am not gratifying my desires NOW but instead putting money aside in a bank account.

Here are a few of my savings goal (in terms of priority) for the short term as well as long term:

Short Term Savings Goal (5 to 10 years)

1. COE for my current car when the COE expires (estimated $25K)
2. Europe holiday
3. Down deposit for 2nd property

Long Term Savings Goal (10 to 30 years)

1. Retirement
2. Child's University Education
3. 2nd Car
4. 3rd Property

This reminds me that I need to start saving for my short term goals.

8 comments:

  1. Can I know why do you need a second car?

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  2. What is your estimated saving% over earned income to achieve your saving goals?

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  3. Hi Axt,

    2nd car is when my current car gets too old to drive and I scrape it. Sorry, should call it a replacement car instead of a 2nd car.

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  4. Was having lunch with the CEO of a huge nanotech MNC the other day and he mentioned something very interesting; "I have many friends who are multi-millionares, but they think the only point of having a big pile of money is to make a bigger pile of money. But what I decided to do was pick one thing in the world I wasn't happy with and use all my wealth to fix it." that's what he wants to leave to his children and grandchildren. A better world, not money that will forever depreciate.

    Perhaps you could take a look at your own goals and talents to see if there's something you'd like to fix about the world you live in.

    As for myself, I just founded an R&D firm that's developing cheap, low-tech methods of pulling nutrients out of marine dead zones :)

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  5. Hi FF,
    I share similar sentiments as the CEO mentioned by Xnsdvd. I don't know if this is a fair statement. "I think many rich people are mainly living for their own self-interests, having the money to live in comfort and pursue own dreams to their own benefits. It is all about self-directed interests." So, it is rare to find even a sincere few among the rich class of people having a noble dream for using their wealth to create value for the needy or less fortunate, or the society at large.

    Jeremy.

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  6. Hi Xnsdvd and anonymous,

    Thanks for the inspiring inputs.

    It does seem that my savings goal tends to be a bit self-centred. But I guess I don't have the abundance to start fixing the world.

    My fixing the world comes from buying tissue paper from poor folks who sell them. That is what I can afford at the moment.

    Of course I hope to be able to be like the CEO or even you.

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  7. I meant that you should first start with applying your mind, then your money. Poor people selling over-priced tissues are part of a problem in financial literacy you're helping to solve with your blog if you ask me.

    Perhaps that's your "save the world" contribution, the neutral, un-biased commentator who's helping the average person understand what it means to be a financially responsible adult.

    Anyway, you're off to a good start, so don't sweat it ;)

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  8. Some poor people are just poor because of unfortunate events. Even if they were financially literate, I guess they just fell victim to tragedies in the family that are sometimes beyond one's control.

    Ha..my "save the world" contribution sounds so small =) But I guess I will just keep working on it. Maybe that's my place in life that I have to be contented with.

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