Savings accounts are a staple of global banking. For anybody who is unfamiliar (or needs a quick refresher), here’s how it usually works.
You deposit an amount of cash into a savings account, and the provider uses that money for their own needs. As a thank you, the provider of the account (typically a bank), will add interest to your savings, meaning that you accrue money on your “loan” to the bank. But we call it savings. Because saying that we loan money to the bank sounds ridiculous.
Can you save in multiple countries? Sure. There are, however, considerations. Check out this guide to multi currency payments for a better idea of spending and saving money abroad.
Now, let’s look at how your savings can go a long way. We’ll start with the basics, and then move on to the 10 by 10 rule.
Your children will grow up – better start saving
The basics of how far your money can go can be expressed using simple sums. And we don’t even have to use a currency to imagine it. We can use the word “unit”, which could represent one unit of any amount of any currency.
Let’s say you are able to save 10 units of any currency per month. That’s 120 units per year or 1,920 units over 16 years. To put that into the context of American dollars, or UK pounds, just as two examples, that means saving $10 or £10 per month for 16 years would equal $1,920 or £1,920 over 16 years.
That’s enough to help your child afford their first car, or pay rent if they need to move away for school or work. But assuming your finances are critically better than being able to save 10 units per month. Let’s up that to a nicely rounded 100 units per month.
By the same sums, after 16 years, that works out at $19,200 or £19,200. And now let’s assume you actually don’t let your child access their savings fund until they are 21. Want to know the total? $25,200 / £25,200 worth of savings. Not bad. Saving really works.
What is the 10 by 10 rule?
Sometimes, saving is hard (as anyone who has saved for a mortgage will attest). Here’s a trick to help get your mind around how easy it can be to save fast using skills you already have.
Can you do something that will earn you a small amount of money? Maybe $10 or £10? Perhaps it’s mowing lawns or dog walking, or helping people build websites, or tutoring in a foreign language, or teaching an instrument. Do it 10 times.
Now you’ve made $100 / £100. Probably in less than a week.
Do it 10 more times. Whatever you do, count it in multiples of 10 as an easy way to track your earnings. Just keep doing it 10 more times. And 10 more. And 10 more. That little bit of effort will soon go a long way in savings, and you are constantly chasing the carrot of ‘10 more times’.