7 Benefits of Saving Money in Your 20s?

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Many people start saving money when they were young. Saving money from the allowances received from their parents while studying in High School and College. Some even started saving their money when they were in grade school!

It gives you an edge if you saved money early and consistently.

Sadly, I am not one of those people who saved money while studying.

However, I started saving money when I was 22 years old.

I got a job that gives me enough money to live independently. At first, I don’t have a concrete plan and just save what is left from my expenses during the month.

I was saving slowly and so little.

Then pandemic hit the world during the first quarter of 2020, this gave me an opportunity to save more every month. Because of restrictions to alot of activities, I started to eat more home cooked meals. I stopped using public vehicles for transportation. I receive a hazard pay in my job at the peak of pandemic last March 2020.

1. Emergency Fund

All these changes in how we live due to pandemic caused me to save more money. There is a high level of uncertainty in our daily lives that caused me to save up big amount of money for any emergencies at home.

Currently I have cash saved in the bank for an emergency fund. It is easy to transfer for one bank account to another. It is also withdrawable anytime. I also have enough cash on hand for any unpredictable moments.

2. Investment Opportunity

I also took a loan to use as a start up to open a high interest passbook savings account and also to start investing in UITF- Unit Investment Trust Fund last May 2020.

You should use the amount you get from any loan wisely.

As I got the loan – pandemic loan, I invested it during the times when the market price is low. I was able to buy thousands of shares because of my loan. And I can see 30% growth from that investment that I bought last May 2020 in my portfolio as of January 2021.

3. Ability to Help Others

I gained the ability to help more people because my savings exceeds my expenses each month.

I was able to pay for my parents Retirement Funds every quarter. I was also able to give money every month for the expenses at home. Doing these things for them brings me so much joy because I was able to give back the sacrifices they had to endure while sending me to school.

I also give to people who is needing financial help whenever I have the opportunity to do so. When I cross someone on the streets or when someone asks for money to buy bread.

4. Pursue your Passion

I had this dream of starting a blog years before I was 20.

My excuse was I don’t have the means to pay for the domain and hosting for my blog.

Now that I saved money in different savings account, I had the courage to pursue my passion in writing. I don’t see finances as a hinder in my dreams anymore. I see money as a helping tool to buy the things that are relevant for my dreams.

I am thankful that this is one of the benefits of saving money! I no longer had to dwell on the excuse of having no money. I acquired the courage to pursue my dream!

5. Stock Market Experience

Early this year, I also opened an account to be able to invest in the Stock Market.

I know I am able to take these risks because I have enough money saved up for myself. It is one of the wonderful benefits of saving money – ability to experience trading in the Stock Market.

Currently I have about 100 shares in a company and 1000 shares in an energy company. Because of another wave of low stock market prices I don’t see alot of growth from my stock portfolio, but I always believe that great things will come sooner when things get back on it’s track.

Update on this! As of March 2021, I bought another 1000 shares in the energy company. I also added 1000 shares in the dividend yielding mutual fund which I also bought in the same brokerage.

6. Automated Savings Account

I also started last May 2020 to automate my salary every cutoff to send money on schedule to another savings account. No matter how little it is, it will accumulate with time and patience!

I had about 400 dollars saved up on it and I bought a gold ring with it. It’s important to automatically save money especially if you are just beginning in your Savings Journey.

7. Watch Your Money Accumulate with Compounding Interest!

My goal when I was 22 years old was to save up 1000 dollars. I believe that I can then I achieved it. I passed the 1000 dollar mark, now my goal as a 24 year old was to save up to 10,000 dollars. I know it’s not alot if compared with the goals of another person but I believe setting small goals is important to achieve it. Then after achieving the goals set, you can aim for a higher goal.

I don’t have my 10,000 dollars yet but I am proud that I am working for it.

Compounding interest can help speed up the time to achieve your savings goal.

If you have little to no idea what compound interest is, you can check out different investment calculator! Try it out and see the power of compounding.

The simple example of compound interest that I can share to you is about your savings account.

You can see the interest per month added to your savings account. As you don’t withdraw the interest, you can see that the amount earned through interest in the next month is slightly higher than in the previous month. If you add more money to your account regularly you can see a growing amount of interest you receive each month.


It’s nice to buy expensive things but when you have the goal in mind, you can easily distinguish needs from wants. You will realize that you have to work for your goals to get the joy you want to have in the long run. You will desire that your money will work for you through compounding interest.

I hope that by reading this blog you learned something from my experiences and decisions I took early in life.

It is challenging to save money when you are facing a pandemic but it’s high time to save more and reach your goals.

Start from saving up for your first 100 dollars. Increase your savings rate as you feel comfortable. Save and invest when you have enough funds. Set your own rules and live life considering both your present and future years.

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How much are you planning to save this year? Message me at couragetoblog@gmail.com and let’s talk more about our finances!

2 comments on “7 Benefits of Saving Money in Your 20s?”

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