by Gordon Hamilton

Created on: July 14, 2009

The risks of not saving money are very real and for a great many people have meant ultimate financial disaster. No one knows what lies around the corner in any aspect of their lives, least of all a financial one, and having a little bit of money put by in the form of savings can be a God-send when faced with an unexpected, significant financial outlay.

The risks of not saving money include the potential inability to cope with an unexpected, emergency outlay. These financial emergencies can come in many shapes and forms, such as major repairs to the car or home, a major appliance in the home requiring replacement, or even the unfortunate passing of a loved one with no arrangement for funeral costs. There is no limit to the nature of these costs and without money put by in the bank, it is possible to face extreme difficulty in trying to meet them.

Taking a loan or putting these expenses on to such as a credit card will often be an option. The problem here is that interest will be charged on the loan or the credit card and if the debt is not paid off in a very timely fashion, the interest accumulated and charged on it could be quite substantial. The risks of not saving money in this respect would be that unexpected outlay not only having to be paid but ultimately more money having to be paid in respect of it.

It may also be the case that there is no availability within the credit card spending limit to pay the bill, or that a loan is applied for but the application is declined. If this were to be the case, the risks of not saving money could prove catastrophic.

There are times in everyone's life when they may not be faced with an unexpected bill but there is something which they decide they wish to buy. It could be anything at all but if it is fairly pricey, those who have saved money may well be able to simply go and buy it. The risks of not saving money in this respect mean that others will either have to put it on the credit card, take a loan, or start saving money with which to make their purchase.

Any period of unexpected unemployment or inability to work through ill-health is a time when one may find the benefits of having saved money. There may be extra expenses incurred due to ill-health or the savings may be required to help make ends meet. The risks of not saving money could also be severe in this situation.

Saving money is therefore desirable for everyone and where possible, a little should be put away each payday for any dark days which may lie ahead or that unexpected desired purchase which may someday be seen.

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