Thursday, October 13, 2016

Savings 101

Does it make sense to save money if you are in debt?  Yes and no.

If your debt is being paid on time and more than the minimum (even mortgages and car loans should be over paid), then yes, you can save money. I didn't ask if you can afford to save. I said you can save.

If you get paid monthly, try to save $50 a month. If you get paid bi-weekly or twice a month, put in $25 a pay check.  It doesn't sound like much, but the secret is to save it and don't touch it. Put it in savings first. If your employer will send it straight to your savings account, send it. Then don't touch it.

If you save $50 a month in cash savings, that's $600 a year. If you start in January, that's your Christmas money. We will talk about gifts and buying later.

What does $50 a month cost you?  It's 2 trips to fast food for a family of 4. It's one trip to a sit down restaurant. Let's face it: a debt free life versus cooking at home once or twice?  I choose debt free.

Right now, before you do another thing, transfer $50 to your savings account. You will be able to survive. I promise.  Once you make a small change, it's so much easier to stick with it.

In all seriousness, you can do this.  Starting small will make such a difference for you.

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