SAVE FOR AN EMERGENCY FUND AND HAVE FUN DOING IT!
You’ve seen these. And once Christmas is over in a few days, they’ll flood your social media feeds again. And you’ll see comments like, “I am SO doing this!” And, if you’re like me, you’ll think to yourself, “You go, Debra. Tell me how that’s working out for you on week 17.”
I don’t want to be a pessimist. I don’t, really. I want to save money, too; and I get that it’s usually not our default to put money aside. It’s hard. Some little chart makes it seem like a piece of cake. I mean, I only have to deposit $1 the first week, right? And $2 the next? I can do that. I can totally do that!!! So why am I pessimistic about them?
These charts that lead you into a temporary sense of financial security are bullshit. Are you really going to make that weekly trip to the bank to deposit that money? Do you even have cash in your wallet today? Probably not. And what happens when you get to week 17 and you can’t keep up? Whether you’re doing the “increase your deposit by a dollar each week method” or one that just assigns you a random amount – because who doesn’t want to save $10,000 by the end of this year??? – those numbers continue to go up exponentially. If you start with $1, sure you’re only having to find an extra $10 in January to put aside, but when December rolls around, are you really going to have an extra $212 to fulfill your annual savings goal? Because, sister, if you can’t spare an extra $212 from your monthly budget today, you sure as hell aren’t going to next December.
Look, I’m a girl that has limited math skills, but I know if I’ve got money to spare or not each month. And let me tell you that some months are lean. You want to save. You want it to be easy. You want it to be painless. Still, you look at your savings account and wonder what awesome adventure you’re going to go on with the $37.63 that’s sitting in there today. And will the $3.48 you have to deposit there at the end of the month even make a difference?
First, yes, it will. It’s $3.48 more than you had before and that’s at least moving in the right direction. Second, there are ways to make it easy and less painful at the same time. Let’s look at some you can start doing immediately.
- Before you do anything else, take a hard look at your monthly budget. You may find that it’s very tight. You may find that it’s not as tight as you thought it was. Let me tell you, it’s shocking to see that sometimes; sitting there looking at the paper going, “I should have how much left over each month? How is that even possible if I feel I’m living paycheck to paycheck?” Oh, it’s possible.The beauty of doing this at the beginning is that you have a CLEAR picture of where you’re starting. I get it. It’s scary to think of even looking at the picture, but you gotta do it. There’s no way you’ll ever, EVER get a handle on your finances and see the changes you want to see if you’re unwilling to look at the picture.
- If you find you have extra money each month that you didn’t think you had, it’s time to start writing yourself a paycheck. Yes, you work hard at all kinds of things that aren’t your “real” job and you never get paid a dime for it, do you? Carpooling kids around? Scrubbing the toilet? Making sure your family doesn’t starve or go naked everyday? Pay yourself for that, girl! Choose an amount that you think you can spare and set up an automatic transfer from your checking account to your savings amount every month. Schedule it to coincide with your real paycheck hitting the bank and it will be less painful. Kind of like having insurance premiums or 401k deductions taken out of your paycheck. What you don’t see from the get go is a lot harder to miss (and spend!).
- Whether you have money that you can automatically transfer or not, set yourself up with some kind of “round up” plan. These are the plans that take each of your debit card purchases, round them up to the next full dollar amount, and deposit that amount into your savings account. I love these because, again, it’s super easy and I don’t “miss” that money. And let me tell you, those $0.34 and $0.62 deposits add up quickly!Not all banks offer these. If yours doesn’t, I recommend checking out the Acorns app (no, this isn’t a sponsored post). It does the same thing and actually allows you to register multiple cards. The money is not transferred to your savings account but rather held in your Acorns investment account where you can begin to dabble in investing. It’s super easy to use, there are lots of easy ways to increase your balance, and you can cash out all or part of your account at any time.
- Stop spending your “found money”. Found money is great. It’s like a gift from the universe. And I’m not saying don’t spend it at all but quit spending ALL of it when it happens to come your way. You find $20 on the street, stick it in your savings. You get an unexpected credit on a bill? Take the money you would’ve spent on it this month and stick it in your savings. Finally paid off that Columbia Record and Tape Club bill you’ve been paying on since 1977? Take that normal bill amount and stick it in your savings (you’ve been living off a budget that didn’t include that amount anyway, right) Grandma, bless her heart, gave you $10 in your birthday card this year to “buy yourself something nice”? Stick it in your savings. Are you sensing a theme?
So, you see, there is money to spare somewhere. You may not be able to save $10,000 by the end of the year (in fact, I would suggest that, unless you make $10k more than you need annually, it’s pretty much a given that your savings account won’t reflect 5 figures on December 31st), but you’ll save something and something is more than nothing.
- This, all of this, is way easier to do if you have a goal in mind of what you want to do with your saved money. Do you want to have a specific dollar amount in your savings account by the end of the year? Focus on that. A trip to see family that you haven’t seen in years? An amount already set aside for Christmas shopping next year? A home improvement project? Whatever it is, focus on it. With every dime, literally, that you put in your savings, remind yourself of what you’re working toward and, most importantly, BELIEVE that you will get there!
- If you’re the kind of person that puts money in your savings account only to withdraw it all and more within two and a half weeks, set up an additional savings account just for your special savings. Don’t link it to your checking account except to transfer money IN to it and make it an off limits account, so to speak.
You can do this. I promise you, you can. Throw out the crazy table that tells you how much you need to deposit each week. It’s not the boss of you. You’ve got this all on your own!