To think saving money without a clear goal seems pointless?

[ByTidyHazelQuoter]

Building up large amounts in cash savings without a clear purpose feels a bit odd to me. I understand having an emergency fund but beyond that I tend to think money should either be working towards something (a goal, investing, etc.) or being used to improve your life in some way.

AIBU to think saving without a clear purpose doesn’t make much sense?

Depends how much money you have doesn't it? I earn very litte so save every penny I can because you never know when you might need it. We have a grand total of about £10-£15k between us in savings accounts which just sits there for a rainy day. If you have a lot of money and don't need anything specific, I'm not sure what you can do with it beyond "investments" (to be honest I've never had enough money to fully understand what people mean by that 😂)

My H has a mega bucks in life insurance which will fall to the DC when we are —broke— & dead
Life insurance is not a good way to save if you want it yourself at any point ( like needing a live in carer) yes you can get it if you take a massive tax hit (which negates the whole point if the higher interest) & yes you can cash in the interest annually. But actually its a scam in MHO. & now thé gouverment ( where I live) are planning to take & use the Life Insurance stashed with no real plan how & when to refund it.
id rather have the cash or gold.
but ideally use it for something where I have control & not the thieving bankers & money shakers ( with their massive salaries & 5 bed houses in Surry)

For us, saving was definitely about security. And thank goodness! I was diagnosed with cancer in May 2023 and, although I am now NED I have been left with long lasting side effects and had to retire early. I don't get my state pension until July 2027 so our savings are topping up our current income. It also means we have a buffer in case something goes wrong and has to be replaced, house repairs, new tyres etc. that we just wouldn't be able to afford without it.

Neither do we, but it is our safety net.

I save to have "options" as a previous poster said.

Do I want to buy a new (to me) car right now? No. Do I want to be able to if I need one? Yes.

Do I plan to replace my roof/boiler? No. Do I want to be able to if I need to? Yes.

Do I plan to move house? Currently this is in the maybe bucket. But I dunno what sort of house I want to move to, or if I want to get a big mortgage or buy something smaller. And do I want my house deposit available up front or am I happy to buy and sell simultaneously.

What if I lose my job? How much of a savings pool do I need in those circumstances? I don't think losing my job is very likely but ultimately you never reaaaallly know.

What about retirement? Ultimately that's a long way in the future for me, and I have got various pensions knocking around but I suspect I'll want to downsize my job before I retire so I would quite like to have enough outside pensions to keep my lifestyle up while I do that. I also suspect that I won't be able to draw my pensions down as early as I want to retire.

So I guess those are sort of all goals, depending on your definition, but none of the money is really earmarked of a specific purpose. And I don't know if I will actually want to do the things I vaguely have in mind when the time comes.

I think the OP’s point is why are you saving and not investing?

Hoarding cash you don’t need in bank accounts is a bit silly as it will be eroding in value over time. Saving to put more money into investments is probably more sensible, and investing with no end goal for the funds isn’t silly at all.

I think most people saving without a specific goal are saving “just in case”, which is quite sensible; you never know what might happen - my car had an unexpected fault last year which rendered it unusable and cost over a grand to put right. I paid it from the “just in case fund” and didn’t think any more about it. If I didn’t have savings it would have been difficult for me to pay for it without using credit, paying it off over a few months and being charged interest.

So if your roof gets a massive leak or your car engine goes pop are you going to start saving once you have that goal? And be without a roof or car for months on end?

Surely the purpose of any savings that aren’t accounted for are security and peace of mind?

Investing it would give you more returns on your money than just accumulating it in your account, but then you have issues of accessibility. So it depends really what your priorities are. If you want your money to be available to you in cash exactly when you want/need it then having it in a savings account makes sense. If you want to grow your money and don’t have any real need to access it urgently, it makes more sense to invest it.

Saving is the goal.

I think lots of people equate saving and investing as essentially the same thing.

I have cash savings for things I may need quickly or in the short term and then investments for long term. Remember investments can go down as well as up and I think the financial crisis of 2009 etc shows that having all your savings in investments could go very wrong, very quickly.

I also find that when we do need something urgently (like a new-to-us car a couple of years ago) then investments aren't as easily accessible and I loath taking out of my investments if they're in a bit of a lull.

Oh it is invested, shares , Isas etc. the op seemed to be saying that one shouldn’t accumulate money unless that money was to be spent on a defined thing. Outside isn’t under the bed or anything.

Ah I didn’t read it like that.

We are very risk averse after dh getting hammered wrt his pension values.
We are approaching 55 so perhaps older than some posters on this thread but we need easily accessible cash as dh plans to retire early at 58 and I'm already semi retired.
We have a plan (ha!) and its doable - assuming we both get a state pension at 67.
We can always downsize, too, if neccessary, but dh not keen.
We won't be able to live extravagantly, but we never have.
So, we save cash to fund early retirement so we can release tranches of cash to bridge pension gaps.

We've got "just in case" savings. Our bathroom started leaking last year and it meant we could just spend £15k on getting a gorgeous new one instead of doing repair jobs or getting something cheaper. We've got money earmarked for DC private school fees (or that'll be their uni/house deposit fund if not) but otherwise we don't have anything we really need right now so it's just savings.

I grew up quite poor but I always saved some money (which was handy when I was skint as a student) and we're teaching our DC the same values.

I think the OP herself is quite unsure as to what she means!

I am making a bit of a leap, but they did say “no real purpose (eg investing)” which makes me think that’s the distinction they’re making… also saying saving and investing is pointless is objectively a silly position 😂

This was my reading as well. It is weirdly phraised and maybe even contradicting but the part about cash savings makes me think that it is about why people don't invest their extra money.

Checking the number several times a day would be a red flag for me.

I like the kind of investment where you invest and forget about it

It's not a red flag for me, because I don't take any action or feel anxious as a result, so I would never sell rashly in a downturn. I just like to know, it's part of my routine like checking Whatsapp or my emails. If I had the money invested gold or jewels I would open the box every day and look at it just to admire it and feel happy that I have it.

I think it is more odd to just spend money for the sake of it.