We save, basically, because we can't predict the future. If we could, we would know precisely how much money we would need for the things that we want and need in the future. But because we can't do this, the need to save money for the future is vital.

Think about these few reasons why:

Emergency cushion - This could be any number of things: a new roof for the house, out-of-pocket medical expenses, or a job layoff and sudden loss of income. You'll need money set aside for these emergencies to avoid going into debt to pay for what you need.

Retirement - If you intend to retire someday, you'll probably need savings and/or investments to take the place of the income you'll no longer get from your job.

Average Life Expectancy - With more advances in medicine and public health, people are now living longer (and needing more money to get by).

Volatility of Social Security - Social Security was never intended to be the primary source of income and should be treated as a supplement to income.

Education - The costs for private and public education are rising every year, and it's getting tougher to meet these demands.

Without money put away in savings and/or investments, you may open yourself up to other risks as well. For example, not having enough money to pay for emergency dental care may force you into taking a loan that your savings might otherwise have covered.

Mike Schiano, The Debt Buster, received a bachelors degree in Political Science from the University of Central Florida in 1987 and earned the prestigious Certified Professional Manager designation in 2000. Since 1992 he has been involved in bringing personal finance education to families across America through his work with various companies. His radio show can heard via the Web at www.inchargeradio.com.

© 2002, InCharge® Education Foundation, Inc. All rights reserved.