As much as I know saving 10% – 20% of my income is the “right” thing to do, it’s not always as easy as it looks on paper. Sure, our financial hero Pete (as seen in my previous post) is the ultimate finance hero; he started saving young and tackling student loan debt.
But just because I’m not like Pete, doesn’t mean I’m doomed or a financial failure.
After reading an article on Master the Art of Saving (How to Start Saving Money -Even if You’re Always Broke), I realized that every little bit counts. Jen started saving just $1.98 every two weeks, and though that sounds like a pittance, it got her into the habit of religiously depositing money into a savings account. Almost anyone can scrape together a buck a week. Over time, that buck might increase to two, three, five, ten, etc. which can make a substantial difference in a savings account.
This same idea can be applied to getting rid of debt. For those financially challenged, it’s difficult to pay off the credit card in full every month or slash those debts by hundreds of dollars every couple of weeks. But by paying just a dollar more on the minimum due, and then increasing that by a few dollars here and there, the balances will disappear faster. The goal is to get into the habit of paying more than the minimum by starting off with baby steps, then increasing those baby steps to big girl/boy steps.
So for those of use who just can’t follow the “correct” financial formula for various reasons (crappy job, crappy pay, irregular income, divorce, etc.), here’s a guide for the rest of us to get us on the right track:
- Yes, you too can SAVE – Save something, anything, and make it auto-deposit into a bank account on a regular basis – whether that’s weekly, bi-weekly, or monthly.
- Get rid of that DEBT – Pay $1.00 more than the minimum due on your balances. Sure, it’s great to pay hundreds more or not have any debt, but for those of us that struggle with finances, paying more than the minimum due will make that debt disappear quicker.
- Learn to WAIT – If you have trouble staying debt free because of impulse buying or not being able to say “no”, wait two to five minutes before indulging or giving an answer. A few minutes gives you time enough to think it through and the courage to walk away, say no, or just wait.
Building new habits takes time, but in order to do so, you have to start somewhere.
Did saving money come naturally to you? Or did you have to build up to it?
8 Comments
I have always been frugal because we didn’t have a lot of money when I was growing up. Now that I’m not working full time anymore, I’m even more frugal. The missus’ laptop can’t even stream video from ABC anymore and we really need a new one. Oh well, we have to spend a bit sometime.
@Midlife Finance – I think I’m the frugal one, but my other half isn’t so frugal. He’s getting better, but I need to get better at saying NO! 😉
I learned at a very young age, that I had to save for the things I wanted. I continued to save my summer money for my spending money in college. As a young adult, savings allowed us to buy our first house and get a very good deal.
@Krantcents – That’s great that you always had that determination to save. I think for some of us, it’s just hard to say no.
Another way to make everything count is to deposit every out of salary earning in to a separate account. That can be used later asa debt repayment or towards a big ticket purchase.
@SB – That’s a great way. I’ve started doing that in small amounts.
I’m a saver by nature. Anytime any ‘new’ money comes our way, my first response to ‘What are we going to do with it?’ is ‘Save it’. In practice that doesn’t always work. Families, especially little kids, seem to take the bite out of saving 🙂
@Money Beagle – Yes, it’s sometimes hard to save money when family members are less likely to save (especially children! 😉 ) But, it sounds like you’re doing quite well.