Many people tell me that they love their job, so they don’t want to save up any money. They are happy to spend everything they earn.
When I started working, I noticed that many people had this attitude. They said they loved working and they envisaged themselves working for the rest of their lives. With this carefree attitude, they took on mortgages, got married, and had multiple children. They assumed that their salary would be there forever, so they behaved as if this were the case.
Then the organization I worked for announced that, due to the 2009 global financial crisis, there would be job cuts. A spill and fill was performed and about 40% of people lost their jobs, and many of the people who lost jobs had huge mortgage debts and multiple children.
I don’t know what happened to everyone who got fired. Many of them were old, which makes it less likely for them to find another job. Some were able to get other jobs, but they mainly just grabbed onto whatever they could find because they were desperate for some income to feed their children and pay for whatever obligations they had.
I remember when I started working. I was enthusiastic and passionate. I had just finished university and was entering the workforce for the first time. I thought I would work forever as well.
After the restructure, I realized then that even thought I started off loving my job, the downturn in the economy forced management to fire people, and the working environment became toxic as a result.
Things change, and you must be prepared for change.
Your circumstances today will not necessarily apply tomorrow. The only constant is change.
This is why having money saved up is important. If you have enough money saved up, you can live off your investments forever and never need to worry about working. This is why you must live off dividends.
It was after this painful incident that I realized that I needed to save up and invest. About six years later, I am still working at this organization, and the horrors of the past have been forgotten, and people are once again telling me that everything is fine, the economy is great, that I should get a mortgage, buy a sports car, etc.
But I know from experience that things can change quickly.
This is why you must save money. You must be prepared for change.