Save That Money!

Saving money can be very difficult for young families. At times it may not be possible at all. But, there are a lot of good reasons you need to trim the budget or increase the income so you can put money in savings. It is critical to have money saved for unexpected expenses (a new roof, or serious illness). It is also wise to have enough to live on for 3-4 months in case you suddenly find yourself unemployed. Opening a Christmas savings account and, at Christmas, only spending what you have in the account is a great way to avoid building more debt. You also need to start early saving for long and short term goals. Having part of your paycheck direct deposited to savings is a great way to save. Every time you get a raise at work you should increase your savings deposit by a percentage you (and your spouse if married) have agreed on. If you never have the money in your checking account or in cash, you won't "miss it". If you get a tax refund, plan to put part in savings and budget the rest BEFORE you get the money. I have met lots of people who complain they can barely make ends meet much less save any money. This is often told to me as they drink a soda and eat a snack they just purchased at a convenience store. Pardon me if I am not very sympathetic in these circumstances. If you buy your sodas and chips in bulk at the grocery and carry them to work with you, then you could put that money you are saving into an account. :) Or you could drink more water or tea (brought in a thermos) and save even more.

Saving money takes effort and a bit of organization. If you are living paycheck to paycheck and you eat lunch out most days you are a fool. Sorry, that is my opinion. Eating out is a luxury you can't afford. Pack a lunch. I have never met a family with both parents working that couldn't trim their spending somewhere in order to save. Take the money in the change jar to the bank every month or two and put it in savings. Instead of the family eating out every weekend, have pizza night at home where everyone makes their own pizza. Put the tax refund in savings. (By the way, if you get over $500 back on federal taxes you need to adjust your withholding so you get more in your paycheck and not in your refund. Put that difference in savings) Maybe you have to cut out the smart phone, beer, movie rentals, cable TV or other luxury items. This is why you should eliminate cash and miscellaneous spending categories in your budget. If you live paycheck to paycheck you should know where every penny of your money is going. Track it for a month and cut out unnecessary spending. If you do carry cash, keep a notebook and log every single thing you spend that cash on.

Wonderful! Someone got a raise and you are no longer living paycheck to paycheck. Don't rush out and buy a new car just yet. Sit down and decide how much of that money will go to savings. The amount to save, (just like the amount to spend on major purchases) should be decided as a couple if you are married. If you are fortunate enough to work for a company that has a 401k plan and offers to match part of what you put in - jump on it. If you can't afford to save the full amount they match when you start working there, put in what you can and bump it up with each raise.

I think family vacations are very important because they allow the family to reconnect and bond. They also allow mom and dad to relax and recharge. Memories of family vacation time will stay with you and your children forever. If money is tight, try not to eliminate the vacation, just reduce the cost. Maybe vacation will just be staying home and playing tourist in your own town for 3 days. (no house or yard work allowed-you are on vacation) End the days with family games and movies. If it is summer, set up water games in the backyard. Maybe vacation will be a trip to stay with nearby family. Camping is inexpensive and there is probably somewhere within an hour of your home that you can get away to. Just a long weekend is fine. If you have some money set aside for a trip but need to stretch it, try renting a room with a kitchenette and eating most of your meals in the room. Carry a large ice chest to allow for more food storage. You could even cook one dish meals to bring with you and heat in the microwave. With 4 children in tow, we found it was cheaper to rent a condo at the beach  than to rent 2 hotel rooms. It also made it easy to cook our meals. I personally think it is better to give up sodas and lunches out all year, if that is what it takes, and have a family vacation instead. Vacation is a good incentive to start saving! Find whatever it take to motivate you and start saving. Even if you already save regularly, I bet you could find a little more money to tuck away if you look.

The Momma