Sarah Sharkey has become a successful saver thanks to her parents. Sarah Sharkey
Sarah Sharkey learned early on from her parents the importance of saving money.
As a child, she already invested 50 percent of her income from gifts and the like in a savings account.
Thanks to her savings strategy, she has already been able to finance her own home and, together with her partner, has built up a six-figure net worth.
Saving money is not always easy. For a stable future, however, it is crucial to invest regularly. Thankfully, I learned that lesson from my parents early on. I should save 50 percent of what I got. Although I wasn’t a fan of this advice as a kid, it helped me build financial stability.
My parents taught me how to save money from a young age. As an incredibly lucky child, I often received money as a gift for my birthday or at Christmas time. My parents took this opportunity to teach me the importance of putting money away even when you don’t want to.
They taught that lesson by requiring me to put half of the money I received in a savings account. Every birthday I counted my presents. And my parents drove me to the bank to put half of that into my own savings account. No matter where I got the money from, up to the age of 18 half of it always ended up in a savings account.
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Saving money is great in theory. But in reality, saving money means giving up the option to buy something. At the age of about ten I was not always satisfied with the arrangement.
Since I wasn’t allowed to spend any of my childhood savings until I was 18, I often tried to negotiate an exemption from the 50 percent savings rate. Finally, I had toys and games I wanted to buy along the way. But my parents helped me stick to a savings plan. We always went to the bank to deposit half of the money I received as a child.
How I save as an adult
As I grew up, I got used to the idea that saving should be a priority. Although it took me some time to get used to it, I am grateful that my parents helped me make saving a habit.
When I left home, saving part of my income was deeply embedded in my mindset. So I took that idea into my adult life. While I’ve definitely not always been able to save 50 percent of my income, I’ve always made sure that saving is a priority.
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On the side, I’ve always made an effort to save at least some of my salary or freelance income. But without early advice from my parents, I’m not sure that saving would play such a big role in my budget.
So far my savings strategy is working
My savings strategy of saving some every payday has opened the door to a bright financial future for me.
Here are a few things my savings mentality has helped me with:
My first financial priority after graduating from college was building a robust emergency fund. And with my savings habit, I was able to build an emergency fund of $35,000. The next goal was to buy a house. In 2020, my husband and I were able to buy our first home with a 20 percent down payment. When I was 25 and my husband was 31, we built a six-figure net worth. This was possible by reallocating part of our savings to an investment portfolio with a long-term perspective.
Eventually, I realized that if I wanted to save more, I had to earn more. So I’ve focused on building a new career as a freelance writer. Although it took some time and careful budgeting, we are now able to save 50 percent of our income.
I can honestly say that achieving these savings goals wouldn’t be possible without the strong saving habit I developed as a kid. Without my parents’ guidance in making saving a priority, my financial life might be completely different.
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This article was translated from English by Klemens Handke. You can find the original here.