Chapter 13 (ECO)
PhillyGirl77
STUDENTPOST_SAVINGS.docxSTUDENT POST #1
I think saving money should be a priority in everyone’s life. It’s okay to go out and treat yourself occasionally, but not every day. I think everyone should have an emergency fund, for example it might be difficult but every time you get your check put aside $50. That money will start to add up.
Saving money is very important to me, doesn’t mean that I’m cheap, I just like to budget. Since most of my income goes toward groceries, I try to budget. For example, I have a store that I shop from and they discount their items 75% after the expiration date, and since all my items are dairy free and meatless they tend to last for a long time after the expiration date. When I go shopping I take a picture or notes when things are going on sale, and on Fridays I purchase those items. Since I buy in bulk I those items last for couple of weeks and then the cycle repeats. My meals are based off what I have in the fridge. I think meal prepping is a great way of saving time and money. Now if you don’t like eating the same thing 3 times a week then this is not for you, but for those who don’t really care it’s a great way to save money.
In summary, if you have extra money left from your check set it aside, and when shopping, shop clearance items in bulk.
The importance of saving can not be stressed enough, because you never know when you may need the money in an emergency. However more than just having money as an emergency resource it is good to have it to invest and to use for big expenditures like a house or something.
One practical way to save money is to try and maintain a steady level of spending through your life and to avoid "lifestyle bloat". For example, right now I am on a tight budget and I am careful on where I spend my money, however once I finish college and get a full time job my salary will go up. even then I believe a key to saving is to try to keep spending only on that which is necessary. I once heard someone call this "lifestyle bloat" because as your earnings go up, your spending tends to go up with it. for instance say you live fairly comfortably and you get a $5000 raise at work, thats awesome and you probably think "OK where can I spend this" but if you were already living comfortably why not save that money instead? If it is saved it can be invested and used later after it has grown considerably. So, in summary, fighting lifestyle bloat is simply another way of saying to spend only what you need and to save that which is extra.
STUDENT POST #3
My husband and I went through Dave Ramsey’s Financial Peace University program a couple of years ago and we have not regretted a minute of it. The program has taught us how to pay off debt in a manner that makes real progress instead of getting stuck in the interest only payments so that we can make actual progress on our principal. We have since paid off all of our credit cards, both vehicles and now only have our house payment which we have a plan to have paid completely within the next six years. We are making 1 additional payment towards our house payment each month (separate from the one in the beginning of the month) because this second payment goes directly to reducing the principal on the house loan.
We speak the Dave Ramsey mantra “Debt is Dumb and Cash is King” as much as possible to remind us of the commitment we have against debt. We use cash envelopes for our groceries, allowances and entertainment budgets and it really does “hurt” when you pay for something with cash. It makes you think twice before letting go of that hard-earned money. We are currently paying for my college tuition and books with cash and it feels really good to know that there will not be a bill when I graduate.
Savings are very important to us because I am not able to work right now due to my son’s autism and special needs. I worry that if my husband gets laid off, we need to have enough money in our emergency fund to support 6 months to 1 year of reduced or no income. We are not up to the one-year mark in our emergency fund – currently only have 5 months saved, but we are continuing on the path towards that piece of mind.
Saving for retirement is also in the works and since we are both in our forty’s it is closer than we think. We do not have enough saved for that yet, but plan to once I finish my degree and then get a job, I can put all of my earnings towards retirement since we are used to living off of one income already.
