Money Management: Saving Money to Get Out of Debt Is Not Safe at All

Money Management: Saving Money to Get Out of Debt Is Not Safe at All

A lot of the so-called "money experts" tell us that we are not saving enough money to help us be financially secure. However, saving money will never make us financially secure. In fact, if you save a hundred thousand dollars in the bank today, your $100,000 will be worth a lot less for the next five years even if you include the interest.

Inflation rates are going higher than the interest rates given to us by our bank. This only means that the more we save, the more our money becomes worthless. I'm not saying that you need to spend all your money to buy things that you want. Financial security depends on the income that you are making, and not the amount that you are saving every month.

Saving won't help you get out of debt. Creating wealth using your money will not only help you get out of debt but will also help you be financial secure in the future. We have been taught to save, save, and save money, but never been taught how to create money using the money that we have saved. Interest from the bank is not about making cash using the money you save, you only let the bank use your funds to help them make money. And in return, they give you a very small amount.

Yes, it is important to save money to get out of debt. But, the way we save will not determine whether we can get out of debt or not - the way we manage our saved cash will.

What you need to do is to clear your debts one by one, and once you have paid all your bills for the month, use the money left in your pocket to generate more money for the next month - invest. Most people save money every month, but after they paid their bills, they deposit their money in the bank, thinking that this is the best way to be financially free.

If you are able to save $200 this month, and used it to generate at least $20 more every month, you will be able to save $220 next month, which can help you make an additional $22, bringing your extra monthly income to $42. Imagine the amount that you can possibly have if you follow this simple step for the next two years. How much will you be making? Do you think you will still be in debt?

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