Which way did it go? You know, your financial life. You grow up. You get involved in work. You get married. You have children. Then, you wake up one day and feel you can’t get ahead.
It’s hard out there. Families struggle to pay bills. The jobs are not what they used to be. Unemployment is over 10%. Unexpected expenses come up. Health issues.
We like to say that “good things and bad things happen to everyone.” If you think about that statement, you will come to see that SAVING IS NOT OPTIONAL.
Okay, so we all know the bad news. Here’s the good:
If you own an automobile, you are among the richest people on Earth.
And YOU can save money if you have a job.
While a lot of experts suggest that you must “pay yourself first,” the truth is that many find this very difficult to actually do.
We want to make it easier. Since we cannot come to your house and help, we thought we would suggest you take the leap of faith yourself and take specific actions to increase your savings and put your family in the direct path of wealth-building.
1. Boost your savings by using our “1% Savings Plan.” Start with your next paycheck. Multiple the after tax paycheck by .01. Take that amount of money – before you pay any bill – and put that money in savings. Then, each paycheck after that you will add another 1% to the amount you are saving until you reach 20%. This allows you to increase your savings slowly, and it will happen a lot faster than you think.
2. Look at each bill you receive. Call the company that sent you the bill. Tell them you have been hit hard by the recession and financial crisis and ask them to help you reduce your bill by 10 – 15% so you can remain a customer. Be open-minded when they make suggestions. Take any percentage saved and push it out of your checking account into an actual savings account.
3. When you shop, negotiate on everything. Focus on concessions from merchants. You don’t have to buy a specific item at a specific store or on-line outlet. Look for the best price and negotiate. Anything you save, put the amount you saved in actual savings. This will give you more “forced savings.”
4. Use coupons on the items you normally purchase. When you do this, put the actual amount you save in SAVINGS. Every single time.
Keep in mind that we have some basic rules:
1. If you don’t put the money you are saving in actual savings, you are not saving.
2. If you use coupons for those things you normally purchase and don’t compare the unit price vs other non coupons, you may not be saving. YOU MAY ONLY BE PARTICIPATING IN MARKETING.
3. Your checking account is a money laundering account for other people’s money. Do anything to move money from checking into a savings vehicle. Make sure your savings vehicle is FDIC-insured.
4. Don’t focus on how much money you make or how much money you save. Focus on what percentage of your after-tax income you are saving each paycheck.
5. Do all you can to reduce debt and then eliminate debt. Debt (especially credit card debt) is the # 1 wealth-building impairment to middle class families today.
If you are ready to take these steps, you are ready to build your savings and eventually your wealth. The sooner you start saving, the better your family will be.
If you’ve not heard our recommendation for emergency savings, you need to hear it. It’s not 1984 anymore. So, we recommend you have a 21st Century emergency savings fund. That means having 15 to 18 months of expenses in a money market savings account or certificates of deposit.
You can do this!
MAKE MORE THAN MONEY COUNT
In this country we don’t do enough to teach our children about money, managing money, saving regularly (and automatically), compound interest and steady investing for a long-term future. As a parent, we are always concerned that they get a good education and go to a good college so they can make a lot of money or have a valued career path. The truth is that we could do our children the biggest favor and one of the best things by sharing with them sound saving and investing principles.
You can join our free Facebook group (or have your children do it, too) by searching in the Facebook bar on your “wall” for “Live The Lifestyle Your Family Deserves.” Click on “become a fan.” It’s free and it ties our free blogs into that group.
If you want to give your children the same information we are giving ours, you can purchase the only thing we sell on any of our blogs or groups. It’s called “How To Survive Any Financial Crisis” and you can get it for only $4.95 at http://www.middleclassmoney.com.
Thank you for reading our blog and good luck!