The virtue of little savings

Never postpone your savings as it will put burden on you, making things tough with lesser time in hand. You can start little, but start today.

Warren buffet said “Someone is sitting in the shade today because somebody planted a sapling a long time, which grew as a tree”.

There is a common proverb that filling the bucket, one drop at a time shows the power of small but regular attempts towards accomplishing greater things in life. But, this gets a whole new facet when it comes to savings.

This new aspect is the power of compounding, which amplifies the power of savings over a period of time. Our monetary achievement is not just decided by how much we save, but also by how early we start saving.

By delaying your savings, you would have to not only begin saving higher amounts but also aspire at higher profits to equal the sum you would have built by making lesser savings otherwise.

Never postpone your savings as it will put burden on you, making things tough with lesser time in hand. You can start little, but start today.


1) Teaches you monetary obedience

Have you ever noticed ants, they have an inborn skill to amass for future in lesser bits. To bring the vernacular to savings, we can also save big amount of money by beginning early even if it is little and by regularly following the course. Ants attain the unattainable through discipline, a quality hard to master, particularly in monetary matters.

The discipline it takes to follow the course is not easy and simple, but once achieved, it becomes a habitual routine.

Taking baby steps like saving little amount from your introductory earnings makes sure that one gets habituated to this practice. Making these savings at the beginning of the month and planning your monthly budgets with the left over earning is a great method of controlling our expenditures. It encouraged the much required monetary discipline by letting us to save for the future and live in our limits in the present.

2) It is a habit of gain, not pain

Inculcate saving habits, just like healthy eating habits or habit of going to a gym. We usually delay our savings by presuming that we don’t have sufficient to save now and with a hope that we will have sufficient tomorrow. But, in reality, along with the earnings, our responsibilities and duties for family care also increases with time. Making higher savings during this time is a hard job. An increase in earnings is related with higher expenses than higher savings. Planning to save increased amounts at this phase puts the pressure on our monetary life.

Beginning to save is little amounts from the initial days of our earning stage guarantees that saving becomes a routine practice. By keeping the amount of savings small, you may not feel the pressure or requirement for major sacrifices in your standard of living.

3) Success banks on time in market and not timing in market

An individual who postpones the savings would either require increasing his/her saving rate considerably or make higher income in order to build the same amount.

Higher profits come with bigger risks where the downfall is high. Timing the market becomes a significant feature when we try to attain high, impractical profits. In history, very few people have effectively been able to time the ‘go get considerably high profits’. One must always rely on the time in the market instead of the timing the market. Monthly savings must be utilised for efficient investments. One must invest over a period of time at different market levels. By doing so, we not only evade timing the market but also gain from the cost averaging in long term.

Another good example to show the virtue of small savings is PF contribution. PF contributions are subtracted and saved on a monthly basis.

We don’t even feel the twinge of this and gather a considerable amount for our retirement. Beginning early and saving 10 percent of earnings at 10 percent interest rate is always advantageous rather than beginning late and saving 20 percent of the same wages aspiring for a 20 percent return.

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