One thing is clear – no extreme is ever good. Also, when it comes to saving money and spending money, it is neither good nor good for the other. When it comes to balance, finding a balance between spending money and saving money is especially important.
Excessive spending of money can lead to a situation
Where it is impossible to cover compulsory expenses such as utility bills, telecommunications, television or internet bills, rent, credit, transport or fuel, food or medicine, visit a doctor and make other mandatory and urgent payments. Everyone, even in theory, knows what can lead to non-payment of primary payments.
For example, without paying a utility bill, you can simply stop providing them by shutting down electricity, stopping heat or water. Failure to make credit payments damages the credit history and can lead to debt recovery or, worse, to legal proceedings. Without going to the doctor and buying the necessary medicines, you can permanently damage your health. In a word, the consequences can be different, but in any case unpleasant.
You have to start worrying about spending too much money and start limiting yourself when spending too much on secondary goals like entertainment, clothing or traveling. If money is only spent for primary purposes and is regularly missing, you should start thinking seriously about finding additional sources of income.
Interestingly, too much money is not good to make
Usually, however, everyone thinks the more money the better. This is not about normal coloring, but about excessive and greedy coloring. Of course, saving money within the normal range of constantly making specific cash reserves that can be used for unexpected and unexpected situations or, on the contrary, planned, such as travel, vacation or a new car, is good and even advisable.
Constantly building up excess cash can avoid the need to use an expensive service – credit, and quickly, simply and cheaply, ie without interest payments, get the coveted product or service you need, and meet your desires and needs.
In the case of a person who only makes money and never spends it
One has to ask the logical question – why is this money ever made when it is not used for any personal purpose? The meaning of money lies in the fact that it is a means of satisfying one’s own desires and / or needs. Failure to do so will make the money meaningless – it will become a worthless piece of paper that just collects dust at home. If money is stored at home, there is a greater risk that it may simply be stolen.
If money is stored electronically, there is a risk that losing your card or access to your account will result in the loss of access to your money. True, this problem is repairable, but losing access temporarily is a fact and can cause inconvenience. Of course, electronic money can also be stolen, especially nowadays when various internet hackers are active. In any case, if you accumulate money at home or electronically, there is a risk of a bank failure, and the accumulated amount over EUR 100,000 will be permanently lost.
The money, as they say, needs to be put to use
Invested or deposited somewhere. Investments can be made in products ( goods and services ), real estate or movable property, as well as, for example, in a savings account, deposit, pension fund, etc. You can find other types of investments and deposits in other sources. The point of investing or depositing money is to gain a benefit that returns to the investor after a certain period of time. For example, money invested in real estate is often recoverable through the sale of property, money invested in a pension fund is retired at retirement age, and money invested in a savings account can be obtained at any time, as a percentage increase.
We encourage you to focus on investing or depositing money, which will reduce over-accruals as well as spending as passive income increases over time, thus reducing the difference between expenses and income.