Saving a dollar a day is 'better than nothing'

Saving a dollar a day is 'better than nothing'

BRUNEI - Saving as little as a dollar a day can lead to a more comfortable future.

It may sound too good to be true, but saving gradually no matter how small the increments will make a difference in the long run, said certified financial advisor Hjh Suhaila Kani.

"Many people may say that saving a dollar a day will get them nowhere, but the truth is, it's actually better than nothing," said Hjh Suhaila, who is the general manager of the Royal Bank of Canada Wealth Management in Brunei.

During a course on "Financial Management for Married Couples" on Wednesday, Hjh Suhaila advised the audience to apply the proverb "sikit-sikit, lama lama jadi bukit" (start small and it builds up to a mountain) early, let the savings grow and avoid spending the earnings too soon.

"Let's say you save $1 a day, putting it into a savings account which offers a four per cent annual return. In 25 years, you will be able to get about $15,000," she said.

This is achievable even for ordinary people drawing ordinary incomes, she stressed.

"Imagine cutting down on the daily 'nasi katok' and putting that money aside for the future. Over 25 years, those nasi katoks would cost you $15,000, which you could instead put into your child's education fund or even as down payment for your car."

"Imagine if you are able to save more than $2 or $3 a day, your wealth will grow more exponentially due to the compounding effect of the interest earned in your savings account," she said.

She said that by merely throwing in an additional $2 daily over the 25-year period, there will be a significant increase of $31,000, whereas saving $3 a day or $5 a day will lead to $46,000 and $77,000 worth of savings respectively.

"I also have had parents telling me how their children already have $10,000 or more in their savings at the age of 15," she said.

While most people would assume that these children were born into privileged families, she pointed that the stories actually came from ordinary people who were dedicated towards saving a small fraction of their salaries everyday.

"The moral of the story here is that you don't have to be rich to have the large sum of money given to you. All you have to do is to commit yourself to saving $1, $5 or even $10 a day," she said.

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