A lot of people feel they cannot save money based upon what they make (income) and what they spend (bills). The truth is that you can use specific strategy to overcome these issues and begin building savings so you have a proper emergency savings fund for 2010 (15 to 18 months of expenses in money market savings and certificates of deposit). By not allowing yourself to be overwhelmed and developing your own strategy, you can make HUGE headway in building savings and eventually wealth.
A Formula That Will Work For Your Family
The formula for getting ahead begins with looking at your expenses and removing emotion from why you spend money.
Begin by looking at everything you spent over the last 90 days.
Separate what you pay in “hard bills” (mortgage or rent, electricity) and “other spending” (shopping or Starbucks coffee).
The idea is simple for this kind or review on actual spending. Begin with the end in mind. Our philosophy is to set a goal of reducing your overall spending by 10 – 15%. To do this, you will have to be open-minded and you will also have to use your creativity. However, this goal can be reached only by removing emotion and focusing on the reduction of spending by 10 – 15%. Keep in mind that you should be open to suggestions when you begin calling the people who send bills to your home. Tell them you must reduce your bill by 15%. Be prepared to talk to a supervisor (who has more power to “cut a deal”) and be willing to call back every 3 days until you see some firm results. Any percentage they drop your bill should be added to your REGULAR and AUTOMATIC savings plan. If they give you 5 – 7%, that is 5 – 7% of new savings beginning the very next month. As long as you take that savings to actual savings….you will be participating in getting ahead.
Once you have called every single business that sends a bill to your house and negotiated to find a way for you to reduce what you pay to them, you will also want to look at the other spending with the same effort in mind. In other words, your goal should be to reduce your spending by 10 – 15% each month. You can do it if you remove the emotion, set the goal and work toward it. However, it is very important to use these “savings” to produce yourself and your family with a “bill” each month for savings that is paid before any other bill or spending.
Another Helpful Way To Boost Savings
Use our “1% Savings Plan.” We especially recommend that you use this plan AFTER doing the exercise above.
Take your very next paycheck. Look at the after-tax amount of that paycheck. Multiply the after-tax amount by .01. This represents 1 percent of your after-tax income. Take that amount – 1% – and push it to savings.
The next time you get paid after that, change the percentage or the multiple to .02. Take that amount to savings.
The paycheck after that, take the number to .03. Take that money to savings.
Keep doing this with each after-tax paycheck you receive until you reach 15%. Make sure you are doing this with each paycheck. You will be shocked and amazed at how quickly this adds up and gives you the savings you need in today’s economy and the one to come.
Want more details? Go to http://www.MiddleClassMoney.com and check out “How To Survive Any Financial Crisis.” It is the only thing we sell on our blogs or websites and it is only $4.95. If you really want to save your family and boost your savings and eventual investing (so your money works for you), this $4.95 is a great deal without question.
Our goal is to always be helpful to other families like ours. You can do this. It is your economy. It is your family, and the only recovery that matters is the one at your house.
HELPING YOUR KIDS GET AHEAD
If you think I was born saving money, you are wrong. My own family didn’t believe in saving. They don’t believe in having a 401k. They have had “emergencies” all their lives. These emergencies always get in the way of saving money regularly. I was not brought up to save and invest regularly and I have made every mistake you can think about when it comes to money. My parents thought they were shielding me from the realities of bills and worry. In fact, they were isolating me. I learned nothing until I had made many of the mistakes they made. I have had to learn the absolute hard way how to get savings on track and make it a part of your life without killing your lifestyle. I have had to learn the hard way how companies mislead with marketing. It is my mission to share what I have learned about regularly saving with my own children and also share it with you. That’s why we have a lot of “free” (blogs like http://www.boostmywealth.wordpress.com and http://www.stickyasset.com/blog and groups on Facebook like “Coupons & Coupon Codes”)!
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!
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