by Amul

Created on: August 19, 2009

Who can say they do not recognize the color and fragrance of money? Money is a medium of exchange, or in simple words, we can say it is the magical thing which can buy goods, services and everything we can wish for. To fulfill our necessary needs and desires without which we cannot survive, we need to earn money. Whatever we earn, the largest portion is spent on fulfilling our needs and desires, and the rest of it we either save or spend on our leisure's which are not very necessary to sustain the life.

A number of people don't believe in saving money. They think that there is no need to save money as they believe idle money is fruitless. Many people ask the question that why they need to save money as there is no benefit of doing so. But this is not true as savings can be beneficial in a number of ways.

Savings can be helpful in emergencies when a sudden need of money arises. For example, a person who does not have medical insurance and gets hurt in an accident or become sick, then for treatment he/she needs load of money. If does not have savings, then he/she is forced to take loan. Thus, in absence of savings people can be trapped in the web of debt and savings can help you for unforeseen needs. Thus, savings can make you more relaxed during the stressful moments.

Most of us must have some dreams, which we cherish for the whole life. Some of them remain unfulfilled because they need lots of money to make them real. But they can be fulfilled if we do some financial planning and save. For example, many of us dream about buying a house, a luxury car or going on a world tour, but we need lots of money to complete such expensive desires.

Savings are also helpful during the financial crisis. Currently, we are having tough economic challenges because of recession. People are losing jobs, loss in business and fighting with financial problems. To meet the basic needs of life, one needs to struggle very hard during financial problems. But one can survive during such crisis if they have enough savings.

The money we save is also useful for the economic well-being of the country. The savings held in the banks are used for investment purposes. Generally, banks utilize these savings for distributing the loans for productive and personal purposes, and they charge some interests for such loans. Banks earn on such loans and they share some of such earnings with their account holders who deposit their savings in the bank.

Learn more about this author, Amul.
Click here to send this author comments or questions.