In order to venture down the path to prosperity, you need to be thinking about saving as much money as possible. Whether this involves decreasing your costs or increasing your earnings, what to do depends on your own personal situation. Here at the Prosperity Sherpa, we have resources to help you figure out what to do to get to your endpoint, from many different starting points. Whether you are beginning with $1,000, $10,000, or all the way up to $100,000, below are three possible uses for your savings.
$1,000: Starting with your first thousand dollars, you may consider thinking small. Investing in yourself at this nest egg level is your best bet. Put money into your education so you can earn more in the long run, pay down credit cards and monthly bills to get yourself set for the next month.
$10,000: Ten thousand bucks is a good level to start your savings account. At this level you want to be thinking about having access to this cash in case of emergencies. Whether you consider a high yield savings account, or checking, you want to be considering the idea of liquidity. Having $10,000 to save is an excellent starting point for your future financial well-being.
$100,000: At this point, if you haven’t already, you need to be looking into long term investments. The opportunity cost of earning a small return in a savings vs the average return for the S&P is enormous. Beware- there are risks, however, they are negligible. You cannot discount the compounding interest that the S&P affords you. At this point you are well on your way to long term financial success- don’t let any barriers stand in your way!