Since you get the gist of just how important savings can be, did you also know that on October 31 1924, World Savings Day was established by an Italian professor by the name of Filippo Ravizza? Back then, it was known as ‘World Thrift Day’ and came with a unique reminder: oppose/fight everything which may impede the practice of thrift such as gambling and lottery!
Why do we need an international day for this?
We wouldn’t really need one if people would only keep in mind the importance of thrift and what a major role healthy savings plans have on their lives. Since that isn’t possible yet, the World Savings Day event was created to increase the awareness of the importance for people to save money, all over the world.
According to the official site of WSBI-ESBG, for more than 90 years, this event also places added focus on the stabilising role played by savings and retail banking in the overall financial system. From its humble beginnings that aimed to educate people about not keeping money in a hole in the wall or under their mattress, we now have an event aiming to educate people that savings is important in the global economy as well, and every depositor contributes to its development.
In conjunction with this day's valuable message, the Credit Counselling and Debt Management Agency (AKPK) recently hosted an exhibition and event that featured various financial activities with more than 20 participating financial and non-financial institutions. Held at the ground floor of Maju Junction Mall, AKPK chief executive officer Azaddin Ngah Tasir was also present.
"We are making progress towards positioning AKPK as the predominant financial education provider in Malaysia and present a platform for consumers to be equipped with money management skills. They can also learn about financial products, rights and obligations as a borrower, as well as basic financial management. It is important to plan your finances where a detailed budget is necessary to take better control of your financial decisions," enthused Azaddin.
As the global slogan for World Savings Day 2017 is 'Our future starts with savings', the event aimed to inform and educate the public on financial matters, including available services that can help individuals to better manage their financial affairs more effectively. Visitors to the event were able to obtain information on financial products and services, conduct Central Credit Reference Information System (CCRIS) report checks, make enquiries or seek advice on financial matters, general health check-up and financial surveys.
It’s always a good idea to keep some money aside for a rainy day. Financial difficulties can also be triggered by abrupt changes in circumstances such as health problems, death of a breadwinner, loss of employment and business failure.
With this in mind, AKPK provides more than debt management and is not only meant for people who are already in debt or bankrupt. To inspire Malaysians to make prudent financial management a way of life, AKPK has this advice: plan your finances thoroughly, spend within your means, seek help early and deal only with legitimate practitioners.
What can I do to be a part of this?
We’re glad you asked this! Here are some do’s and don’ts to help you kickstart your way to having a healthy savings fund (or piggybank, if you still roll that way).
1) Start saving now. If you keep having the mindset that you’ll do it tomorrow/next month/next year, you’ll end up starting too late and will lose out on the earnings from compound interest. The longer your money remains in the account, the greater the amount at the end.
2) Understand your financial situation. This goes without saying: if you aren’t able to figure out your expenses, how are you then able to figure out a suitable sum to save? Once you make a budget to keep track of how much is going where, you don’t waste unnecessarily, thereby motivating yourself to remain focused and stay on track.
3) Pay yourself first. When payday rolls around, the joy is but fleeting. However, don't just pay all your bills and buy whatever your heart fancies, then only see what is left for you to save. Pick an amount, preferably 20% of your take-home salary, and immediately transfer this into a savings account, like you would any other bill.
1) Leave that savings account alone. You find that you're a little tight on cash and you're thinking of dipping into your savings account. Don't! To eliminate any temptations to do so, make your savings account difficult to access. Choose one that doesn't have instant access such as those that are linked online.
2) Deal with debts first. Many people think that they should save while paying off their debts. Don't! Trying to do both might stretch your finances too thin and you'll find that the little you've been saving needs to go towards paying off debt that's been driven up by interest. You will ultimately pay less back if you pay off the interest quicker.
3) Save with or without a steady job. As a freelancer or part-timer, you'd think that you won't need to set aside savings since there might not be enough. Don't! You always have to be ready, flexible, and with an emergency fund on hand. Make sure to allocate a bit of money each month, no matter how small. Remember: A little goes a long way.