Four Secrets to Saving


America is the land of opportunity – a land of prosperity where hard work is usually rewarded with positive results and advancement possibilities. However, the status quo in the U.S. seems to be that people will live right up to their income level and delay saving for “some other time.” In general, when it comes to a lack of savings, it is often a matter of high spending rather than low income. Of course, there are exceptions; situations when we need to spend more due to employment loss or unexpected healthcare bills, etc. For the majority, our lack of saving is due to excessive spending – a habit we need to get under control. So, I wanted to share a few simple strategies that can help increase savings without significantly changing your quality of life.


1. Let it simmer. We all live in this instant gratification world, where we have to have everything right now. Instant downloads, free overnight shipping, soon-to-be drone package delivery within six hours. Next time you consider a purchase, try giving yourself some time to think about it. Do you need it … or just want it? I recommend the bigger the purchase, the more “simmering” time. If it’s a car, give it a couple of weeks. Thinking about new shoes? Buy them next weekend. Give yourself time to rationalize the purchase and if you still feel you need it, you can move forward knowing it wasn’t an impulse.


2. Pay yourself first. When you get a paycheck, you likely pay rent first, car second, insurance third, and so on. Somewhere, at the very end of that list, is your savings. Change this immediately! Start by moving money from your checking account to your savings first! It doesn’t have to be a huge amount; but if you start with even a small amount, it adds up quickly. Start this habit and stick to it!


3. Be a Smart Shopper. Since we are always in a hurry, it is easy to grab snacks or coffee when we are out and about. If you stop at a party store every day for a quick coffee on your way to work, that $1.75 a cup adds up to about $600 a year! In an interest bearing account at 5% for 30 years, that $600 would give you over $30,000 in your pocket. Start paying more attention to those “little” expenditures; they really do add up.


4. Set Goals. It has been said that hindsight is 20/20. Had you begun saving $200/month ten years ago and put it in a tin can in your backyard, you would have $24,000 in that rusty can right now. Unfortunately, we can’t go back in time; but we can look forward from this point. There are many free tools online that you can use to compute how much you are willing to save each month and what that amount will be worth in the future, given a chosen rate of return.

Implementing these four simple steps will help you get on the path to increasing your savings. You may also want to consult with a financial professional about putting that money somewhere other than a tin can. There are many qualified financial advisors in Genesee County who would love to help you successfully save for the future.


Securities offered through Sigma Financial Corporation, member FINRA/SIPC.
Investment advisory services offered through SPC, a registered investment advisor.
OLV Investment Group is independent of Sigma Financial Corporation and SPC.


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