Some of you have probably read the story in an email or on the internet about a father who for years puts his pocket change into a glass jar he keeps on the floor in his bedroom. His son watches and questions him about it, and he explains it will pay for his son’s college one day. And, indeed it does. When the son finally graduates, he sees the glass jar is gone, but he decides he will keep a jar in his own bedroom, too, which pays for his marriage. When he and his wife have a new baby girl, they take her to see her grandfather. While visiting his father the son notes there is a new glass jar in his father’s bedroom, standing ready for another generation’s college fund.
It’s a tender story, about generations, and about a learned pattern of behavior. It’s called saving or budgeting, and as we are on the verge of entering a new year, it’s a good time to contemplate that story. We should all be saving as a natural pattern in our lives, and at the same time, we should be teaching our children the value of saving.
Here are some ways for you to save and for you to teach your children how to save and value money before they leave your home. Saving, even small, is worth it. Keep these simple figure in your head – saving $1.00 a day will net you $365 for the year; saving $3.00 a day will net you $1,000 for the year!
- Do not wait to start saving. Many think they have to earn more or be in a better position to save. That’s not right thinking. If you have more money, you will spend more, and the best time to start saving is now because every day of savings counts. Even if you only save a few coins, it makes a difference. The trick is to always save something.
- Record and subtract every debit card expenditure right away in your check book; don’t let receipts pile up before going to your check book. A debit card is immediately subtracted from your money; it’s best to know what you have left after each purchase rather than be shocked after making several purchases. It might be a good thing to do the same with your credit card. Even though you don’t need to pay your credit card balance until the end of the month, the second you spend it, your money is gone.
- While you’re in your checkbook, when you subtract an expenditure, round the figure up to an even dollar amount. This will make your balance even and allow you to save a few cents on every deduction. Soon there will be a “spare tire” in your checking account to protect you against mistakes and overdrafts as well as start growing some extra money. It’s like putting coins in the glass jar.
- Try depositing your salary into your savings account rather than into a checking account. This works in two ways to help you save. First, if you have to transfer money to your checking from savings to spend it, it will be harder and give you time to think before spending. You may end up spending less. Also, people have a different feeling about watching their savings grow and are more reluctant to deduct from a savings account.
- When you see something you want to buy, don’t deny yourself, but give yourself three days to think about it before purchasing it. Often you will never go back for the purchase after three days. Savings!
- Never pay off a debt. No, you need to pay off your car and your house, etc., but pretend you have never stopped paying for it. Instead have the same amount direct deposited into your savings or into an investment account. You might never have to borrow again for a car.
These are good mind sets and simple ways to save. Make sure your children see you develop patterns that help you save everyday and constantly. You will be surprised what they pick up for a lifetime.
Have a very frugal New Year!
For more money saving and budgeting tips, you might want to read other articles at Pennypinchinghints.com:
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