We all know that saving money is an important financial goal. In this brief video, Fool contributor Chuck Saletta spells out three of the most important reasons why saving is such a critical part of each and every financial plan. Those key reasons are:
- You have to save for your money to compound for you.
- Having savings gives you flexibility when you need it.
- The more you save, the less you need to save.
What 20 years of saving/investing can get you
| Monthly Savings | 0% Annual Returns | 3% Annual Returns | 6% Annual Returns | 9% Annual Returns |
|---|---|---|---|---|
| $0 | $0 | $0 | $0 | $0 |
| $100 | $24,000 | $32,830 | $46,204 | $66,789 |
| $250 | $60,000 | $82,075 | $115,510 | $166,972 |
| $500 | $120,000 | $164,151 | $231,020 | $333,943 |
| $1,000 | $240,000 | $328,302 | $462,041 | $667,887 |
| $1,500 | $360,000 | $492,453 | $693,061 | $1,001,830 |
Table from author's calculations.
Chuck Saletta is a Motley Fool contributor. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.