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, 2008 |
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Credit Wise Saving Grace
Things have
definitely changed since the days when my parents were growing up. All right.
Fine! I admit it (even though it makes me feel like I’m getting old). Things
have changed a lot since I was a kid, too. I remember when it was customary for
your parents to take you down to the local bank to open a savings account as
soon as you could grasp the concept. Most of us started with good ol’ piggy
and graduated to the real bank when we’d collected enough $5.00 birthday
checks from Grandma. I remember how diligently I’d keep my savings ledger
up-to-date. I recall being so excited when I had enough pennies saved to
warrant a trip to the bank. Do most parents even do that anymore with their
kids? More...
Some of you may even remember the days when “consumer debt” were dirty words. Not that long ago, it was uncommon for people to have a lot of debt. Credit cards were rare and it was virtually unheard of to have thousands of dollars worth of credit card debt. Bankruptcy was a last resort and was pretty scandalous in small towns where you didn’t want your neighbors to know your financial secrets. Now, it’s just a slight hiccup in someone’s financial history. Yes, we’ve made progress in some areas but when it comes to credit card debt; our culture has gone too far over the line. Recently during the talks between Back in the good ol’ days, families saved money. Then, when the car needed tires or the dog got sick, they’d dip into their savings account and pay for it. Yes, we saved for retirement but we also saved for emergencies. That is what it was there for. Over the past several years with the availability of fast cash and credit cards, we have shifted away from saving. Now, if the air conditioner goes out, we just finance the repairs. Need cash when the radiator goes out in your car? Get a loan! Want to buy something you can’t afford? Just charge it! It’s an easy trap to fall into. Then, instead of saving, we are too busy paying credit card bills to save. We just don’t have the money. It never ceases to amaze me how much the
holiday season can send people into a frenzy. Many people act like they don’t
know when Christmas is. It doesn’t change. Same day every year. But, we just
don’t plan for it. Then, before we know it, the bell ringers are posted
outside department stores and the line to see Santa snakes through the mall. The
year just goes by and before we know it, we are faced with Christmastime and no
savings. Then, another Christmas gets financed on credit cards and maybe
you’re still paying for the last one. We have to change this cycle we are in.
I’m not trying to demonize credit card companies but we need to find some
healthy balance into our way of thinking. If we are going to fix the financial
problems that so many people are facing, we need to start at home. Whether
it’s to pay for Christmas next year or to begin your emergency fund, here are
a few ways to kick start your savings. Pay
yourself first: If you wait until you pay all of your bills, buy the
kids what they want and need, and purchase all of the expenses that come up
through the week, chances are there won’t be anything left to save. If you
sock away money into savings right after you get paid, you won’t spend it on
impulse items. Out of sight, out of mind: If your employer offers direct deposit, enroll in it. Then, designate an amount of your income to go directly into a savings account. If you never see it, you never miss it and it will be there when you need it. If you don’t have direct deposit, you can still deposit a percentage of your income into a savings account. Avoid
temptation: If you find yourself robbing your savings account each
and every month, try putting your savings account in another bank. Preferably
across town. One with typical banker’s hours that is hard to get to before
they close. That way, you have to make more of a conscious effort to withdraw
the money. It’s there when you need it but you probably won’t withdraw funds
on a whim. Roll,
baby, roll: Once you pay something off, instead of spending the money
you used for bill paying, save it. If you’re already used to living without
that money, you won’t miss it when it’s sitting in your savings account for
a rainy day. Raise the bar: If you get a raise at work, consider putting that extra cash into savings. As you do this, you will find yourself relying on credit cards less and less. What if I
just can’t? If you feel like there just isn’t anything to save,
let’s compromise. Start small. Just get into the habit. The amount does not
matter at first. Just put something in savings. Then, increase it when you can.
If you can’t put your entire raise into savings, start with half of it. I know that saving can be tough but starting is really the hard part. Once you begin, it’s pretty exciting to look in the bank and see how much you have just sitting there. The key is to stick with it and don’t be too hard on yourself. If you have an expense come up and have to use your savings, it’s OK. Just start again. At least it wasn’t something that you had to put on a credit card. You got through a mini crisis and didn’t get further into debt. It’s finding those little victories as you go long that will make you successful. If you can make it through this holiday season without acquiring debt, good for you! If not, start saving now for next year. I wish you all a very happy and healthy
holiday season!
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Copyright © 2006 by Jennifer Wallis. All rights reserved. Want more money-saving tips? Get a FREE Subscription to our monthly newsletter!
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