What’s probably the top goal that I hear from people? They want to “save money”. Great….. so what does that mean? Spend less? Get better deals? Oh, no. They want more money in their savings account. I suppose you could say they want to be money hoarders. Now I’m not against having more money in savings, but I think, in most cases, they have the cart before the horse if you will.
So, what’s the one key thing to saving more money? The real lynch-pin? The keystone that holds it all up and together?
OK, maybe that’s a little over simplified of an answer to make much sense, but it really is where the conversation on saving more money needs to start.
Your boss may really, really like you. You get good evaluations, you get a little leniency with the time clock when you need it, maybe even a free cup of coffee here and there (the good stuff, not the break-room coffee). But when it comes down to it, that same boss most likely is not going to give you a raise just because you want more money in your account.
Short of switching jobs, you probably aren’t going to be able to increase your income. So now what?
This is where the spending comes in. If we can’t increase our income, then we have to address where our money is going out to make room for more going into savings.
Quick! Without looking, do you know how much you spent on gas for the car last month? How about what you spent eating out? Better yet, do you know what you spent on candy bars and coffee when the boss wasn’t supporting your habit?
For many of our clients that we work with in credit counseling, they often have the money to accomplish their goals. They are just choosing to spend it elsewhere. Don’t take offense if this is you – I don’t mean it as a statement of being good or bad. Rather, it is a statement that your spending is your choice.
When we realize and own our spending as our own choice, then we own the ability to control and change it. Being intentional about it, we create a portion of our income that is able to go into savings. And that without a raise from the boss.
If you are serious about this, here are a few tips on getting more money into your savings:
Do you need it? – Ask yourself this every time you go to buy something. Even if you don’t need it, can you afford it? Does it fit into your budget, your plan for your money? If so, then go for it. Enjoy it. Just get in the habit of evaluation all of your purchases in the bigger context of your plan.
How many hours? – This one takes a little more math. First, figure out what you take home for every hour that you work. This isn’t the gross pay, the large number. This is the net pay you get after taxes and any other deductions. Now, anytime you consider sending money, figure out how many hours you need to work to pay for that purchase. You have to work how many days for that good Friday night out? Is it really worth it? If so, then go ahead and enjoy it. But remember how many hours of work you need to pay for that.
How’s it going? – As humans, most of us don’t like to admit defeat. Knowing that we might have to can often be a motivator for us to work harder. So ask someone to hold you accountable and check in with you every Monday morning. Because you know they are going to ask how you are doing with your budget, you are more likely to stick to it so you don’t have to admit defeat.
Finally, realize that you don’t have to figure this all out on your own. While our counselors at the Center for Financial Resources can usually help people in total crisis mode, we also like to help people before they get there. We have clients that come in monthly just to have us look over their budget and expenses. If that’s what they need to be financially healthy, we are happy to do it. All you need to do is schedule an appointment online or call us at 605-330-2700.
written by Breck Miller
images courtesy freedigitalphotos.net