NOW is a Good Time to Save
You are either a saver or a spender. At times we are both but we will gravitate to one direction most of the time. Of course, if you are more of a saver these ideas might be old hat, or not. And if you are a spender, well listen up.
This doesn’t take much; $5 a month even works. It is the habit that you are getting into that matters the most, and most habits take about 21 days to form so, give yourself time.
Saving starts with ‘not spending’ the money and it can be easier to save if you don’t ‘see’ the money:
-Take it out of your paycheck first. Some banks allow you to have money split between accounts for your paycheck. Also 1% going to a 401k can do wonders, especially if the company matches 25-100%; that is free money.
– When you get a raise. Put that away before you get used to spending it. Sock it away in your 401k or have it moved to a savings account or the like.
-Unexpected Money. Don’t use the tax refund to pay down your credit card bill; you may just run it up again. Don’t use the inheritance to buy a car; it will just need repair and higher insurance. Again, put it into some form of a savings.
If that isn’t up your alley, then try some of these money games:
– Round up in the checkbook. Everytime you write something in the checkbook, round up to the next dollar amount, when you balance you will always have extra in there. At the end of the month transfer the money to your savings.
– ONLY spend dollars, NO change. If you receive change back, find it on the street, or in the cushions, DON’T spend it! Put it away in a piggy bank or a jar of some sort that you can’t dig into with your hands that may end up spent on soda pop or vending machines
I follow alot of these steps and save money for a future condo. I don’t move my savings through direct deposit, but manually move it at the beginning of the month because I like the thrill of seeing the money increase.
Beeble is on to something. For people who have a compulsion to spend, maybe automatic transfers are the best. But I’m like beeble: there really is a thrill of doing it by hand. I add to my niece’s 529 college fund online each month (my Quicken software saw this, and started prompting me), and I get really pumped when I hit the “confirm” button. Of course, if I *did* automate my savings, I might end up saving even more …
Okay, this is a subject I could talk about forever. I’ve counseled more than a dozen friends and lovers out of some considerable debt into comfortable savings plans. I’ll try to be brief.
I have probably fifteen different methods I use to save, including rounding up in the checkbook and giving my savings a raise instead of myself. The one I have that others I counsel can’t seem to get into and that makes me look like a Luddite is taking a certain amount of cash out of the ATM every Monday. The amount is always the same and the idea is always to have it last the entire week. (If you are a big spender it could be dangerous to carry around a wad. But the idea is to spend less, right?) I’m not too hard on myself if I go over one week, but I’m always very aware of how much I’m going over.
I also keep my checking balance pretty low. And once the established amount is surpassed I move the difference into my savings. My savings has another cap and once that cap is surpassed by a good amount then that difference is moved to a smarter/higher interest account or other investment strategy. It’s a heirarchy of numbers that makes saving money almost as fun as sex.
“It’s a heirarchy of numbers that makes saving money almost as fun as sex. ”
I would have to agree with you their… something about seeing a savings account increase in size…. sounds good to me!