Thursday, April 18, 2024

Personal Savings: a ladder to wealth creation

Personal savings, from time immemorial, have been a ladder to creating wealth.

Irrespective of the testimonies available, how savings should be achieved has continued to be difficult to understand.

To some people, saving is the money left over after subtracting consumer spending from disposable income. (Disposable income is the money available after deducting tax).

Others consider saving as a means of paying yourself first rather than paying others through consumption.

That’s not all, some see savings as a way to prepare for financial emergencies and contingencies.

What is personal savings?

According to the Longman dictionary, personal savings means when a person, rather than a company or organization, saves money to spend or invest later.

Personal savings can also be regarded as money that an individual has put away for non-immediate use.

Importance Of Personal Savings

The importance of your personal savings can never be over-emphasized. It goes beyond personal as it also serves as a source of capital for businesses. Let’s discuss its importance briefly:


It’s almost impossible to predict what will happen tomorrow. And even though financial emergencies are not always about bad occurrences, it’s still important to have some money saved.

There are positive financial emergencies such as relocating due to changes in a job which can even call for a change of wardrobe.

Savings can serve as an emergency fund and can help to avoid taking high-interest loans or selling properties.

Savings provide financial security in times of need.

Special events

An adage says, “the birth of a baby is not an emergency”. You have been waiting for the baby for 9 months.

There are special events and obligations such as marriage, scholarships, buying a car or land, etc. You should put some money aside for these rare occasions.

Saving for your kids should also be considered.

Accumulating wealth

We don’t always talk about savings as a means of accumulating wealth but we rather talk about personal savings in terms of expenses- saving to spend later.

However, there is a thin line between using savings for the earlier mentioned purposes and using it as a means of accumulating wealth.

Before savings can be used for accumulating wealth, you must invest your savings. And to invest your savings, you must improve them.

How Can I Improve My Personal Savings?

Improving your personal savings is not a walk-over discussion as it requires discipline, determination, and commitment.

To help you further, you can adopt any of these generally accepted rules:

50-30-20 rule

This rule was made popular by US senator, Elizabeth Warren in her book titled, “All your worth: The Ultimate Lifetime Money Plan”.

To better understand the rule, 50% of your income should be spent on needs, 30% on wants, and 20% should be saved.

The problem with this rule is the ambiguity in classifying needs and wants. For instance, a data subscription might be a need for someone while for another person, it is a want.

60-40 rule

The 60/40 rule has also been in use for a good number of years. Mostly it is used in investment by investing 60% of your savings in a volatile investment like cryptocurrency while 40% should be invested in fixed investment.

In this context, 60% of your income should be expended while 40% should be saved.

If your income level and consumption are very close, you can adopt the 50/30/20 rule but if your consumption is not high, you can adopt the 60/40 rule or even reverse it by saving 60% and spending 40%.

How Do I Invest?

The next big question is, “what should I invest in and how do I go about it?

Investment is a lifelong benefit and therefore, you should be extra careful when it comes to investment.

Nevertheless, cryptocurrency investment has proven to be a great investment due to its possible returns.

How Can I Invest In What I Do Not Know About?

That’s why Crypto Smart has a savings plan called BitSave.

Bitsave is a savings plan for individuals to profit from crypto trading without going through the difficulty of investing in cryptocurrency.

The analysis will be done by Crypto Smart while you will be advised on the best altcoins to buy.

Bitsave, as a saving protocol built on Algorand, allows users to earn interest by staking their stablecoins and cryptocurrency.

Note that Crypto Smart will not hold your crypto assets.

To get started, sign up here

If you want to start corporate savings; that Is, saving on a larger scale, you can read about asset management.

Are you saving already? You can learn how to diversify your portfolio and the benefits.

About Crypto Smart

Crypto Smart is a B2B Crypto Asset Management company founded in January 2021 by Karla Obakpolor, a blockchain business developer and Algorand ambassador in 2020.

Crypto Smart offers fast and secure services which are based on a well-encrypted system with 24/7 customer support services. Crypto Smart has grown from offering its services to individuals to companies and major enterprises as well as providing crypto education through various crypto courses. 

Crypto Smart upscaled to the Algorand blockchain and offers blockchain products which include SmartChange; a cross-chain P2P marketplace, Bitsave Protocol; a SaveFi protocol that combines savings with DeFi. 

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