Saving Money for a Goal Pros, Cons, and How to Do It
                     S A V I N G M O N E YF O R A 
 G O A L :P R O S ,C O N S ,  
A N D H O W T O D O I T
B Y L E V E L F I N A N C  I N 
G

Whether it is learning a new skill, buying a new car, or 
exploring  foreign countries, we all have goals in our life. 
Sometimes,  though, these goals have monetary costs that we 
can’t cover  right away. Becoming fluent in a foreign language 
may require  paying for a course, and that minivan we’re so 
eager to buy  may cost a couple of thousand dollars more than 
we can afford.
While taking out a loan is probably the quickest way to finance 
 these expenses, saving money undoubtedly has many  
advantages. After exploring the pros and cons of saving 
money  for a goal, we will give you the best tips to do so in 
the most  effective way.
T H E P R O S O F S A V I N G R A T H E R T H A N B O R R O W I N 
G
Earning Interest Instead Of Paying It
Avoiding A Negative Impact On Your Credit 
Score  Staying Away From Debt Traps
More Negotiation Power When Paying Cash 
Upfront  Peace Of Mind
T H E C O N S O F S A V I N G R A T H E R T H A N B 
O R R O W I N G
It Takes Longer
Your Current Income May Not Allow 
It  Short-Term Sacrifices
You May Have To Retire Funds From Other 
Investments  Tapping Your Emergency Savings
S A V I N G M O N E Y F O R A G O A L : H O W T O D O I 
T
Clearly Define What You Are Saving For
There is a difference between generically saving money and putting  
money aside for a specific goal. Right from the start, you should have 
a  clear idea of the reason (or reasons) you are saving for.
Multiple Goals? Define Priorities And Percentages
When saving for more than one goal, you should determine their 
scale  of importance. Let’s say you want to save for both a trip to 
Australia  and a new motorbike. Which of these two things do you 
wish for the  most?
Make A List Of Expendable Expenses
There are costs we can’t get rid of, such as rent, utilities like water,  
sewer, gas, and electricity, food, or medical insurance. Next, there are 
 those expenses we could cross out, but we’d rather not. For some  
people, it may be a gym subscription, while for others, it may be 
Friday  evenings out with friends.
Look For Cheaper Alternatives To Your Current Expenses
Let’s say you don’t want to give up taking online language courses to  
save money for a boat. Is there an alternative, cheaper course you 
can  take? Similarly, is there a gym that offers a cheaper subscription 
than  your current one?
Look For Saving Opportunities By Planning Your Expenses
Not everybody budgets in a planned and structured way. Many people 
 have an approximate idea of how much they’re going to spend each  
month on specific goods, services, or activities. Yet taking some time 
to  write down how much of your income you are going to allocate for 
each  expense has its benefits.
Increase Your Saving Rate Gradually
Saving money usually implies a change in certain habits and sometimes 
 in your general lifestyle. For this reason, you shouldn’t try to save  
everything you can immediately. You need some time to adjust to 
these  changes.
Not In A Hurry? Consider A Long-Term Savings 
Tool
If you’re saving money for the long run, it’s wise to consider some 
 type of long-term investment or savings account. For example, a 
 CD (Certificate of Deposit) can considerably boost the interest on 
 the money you save compared to a basic savings account. 
Based  on data published on Forbes, the highest yield in August 
2022 was
2.25% for 6-month 
CDs  2.85% for a 1-
year CDs  2.96% for 2-
year CDs  3.25% for 5-
year CDs
To Sum It 
Up
To wrap it up, here’s a quick summary of the topics we discussed in 
the  article:
As opposed to taking out a loan, saving money allows you to 
profit  from compound interest and doesn’t impact your credit 
score.
Saving money is also better for your peace of mind and allows 
you  to pay cash upfront, which increases your bargaining power.
Yet saving money also has its drawbacks. It takes longer, and it 
may  require sacrificing current expenses or investments.
If you can take your time to save money, consider long-
term  investments, such as a certificate of deposit.
T H A N K Y O  U
H T T P S : / / L E V E L F I N A N C I N G . C O M / S A V I N G -  M
 O N E Y - F O R - A - G O A L /