It may seem not easy and immediate to understand and above all to implement, but by saving a
few years in the first years of one’s working career, thanks to the effect of
compound interests, it is possible to obtain great advantages in the medium term and slowly become richer.
Earn money slowly
In particular, in a short time, while continuing to save the same percentage of one’s income, a standard of living and disposable income is achieved that is much higher than those who adopt a less thrifty attitude.
If it doesn’t seem true to you, try doing some simulations and you will find that 1 euro invested for 30 years:
- at 2% per year it turns into € 1.81;
- at 4% in € 3.24;
- at 6% in € 5.74;
- 8% in 10.06 euros;
- at 10% in € 17.45;
- at 15% in 66.2 euros.
This is why it is essential to be able to monitor your expenses and maximize your savings to allow yourself a peaceful and peaceful existence. For example, saving 10,000 euros a year, in 5 years I will be able to have more than 50,000 euros which will guarantee me an extra income (net of inflation) of about 1,000 euros a year. An extra monthly payment that otherwise I will never be able to get.
Ten thousand euros of savings per year is a goal that is consistent with my expectations. However, if this year – in which I will have extraordinary income – I think it will be easy to achieve the desired result, perhaps it will be ambitious to continue saving so much also in the future. I believe that saving 20% of one’s salary is an achievable goal albeit with some sacrifices. Easier and easier to reach 10% – 15%. In my case, this would be equivalent to around 5,000 euros per year. Only when I have monitored the expenses of an entire month will I be able to understand if the goal is realistic or not.
So let’s wait for March and try to reach the goal.
The title of the post is taken from an American personal finance site Get rich slowly – Get rich slowly. The site tells the story of an employee who, after accumulating 35,000 in debt, found his way to wealth thanks to careful management of his finances, repaid his debts, and started investing and saving.