Americans are known for a lot of things but being prolific savers isn’t one of them. We are known for being industrious, gregarious, credit lovers, and so many other fun cultural traits. In my quest for financial independence savings and a focus on creating passive income streams are what I feel are the keys to my future success after paying off my debt.
I’ve recently taken the 50% Pledge spearheaded by Kathleen from Frugal Portland and LaTisha from YoungFinances. I am concerned about my overall savings rate, my future retirement, and just having enough cash on hand for my daily expenses.
It has taken me a year to aggressively cut my expenses, pay down debt, create a plan, forgive myself when I make mistakes, and keep focused. My monthly expenses not including my retirement savings average around $2000 a month and will decrease to around $1700 by July when I pay of Mr. Chubbs (my credit card). As I focus on increasing my earnings and increasing my mortgage payments by a substantial amount I am concerned about the progress that I’m making with my savings account. It’s not growing as quickly as I would like.
Recently I read a very interesting comment in a book about Black Millionaires. Basically, one of the millionaires interviewed said that if you look at a person’s savings you can judge how they feel about themselves.
When I look at my account it doesn’t reflect how I’m feeling about myself-now. I’ve changed a lot in the past year. I used to feel like crap for a long time. I had a lot that made me feel crappy. But now, I’m feeling…kind of HAPPY!!! I want my money, body, mental health, and overall life to reflect how I feel.
I’ve set an audacious savings goal for 2014 but getting it kick started and having a “substantial” sustained amount hasn’t happened. It has been super annoying.
I just utilized my new internet tax prep system last week and I received a refund-not a substantial one, but big enough to get my anemic savings a little more oomph! Even though my expenses have decreased by quite a bit, my past monthly surplus’ have gone towards the following during 2013: getting my storage cleared out, paying off 3 credit cards, travel, holiday expenses, and some home repairs.
This year I have similar expenses: a credit card, travel, and some home repairs. The big difference is that I am making more in side hustle income and my overall monthly expenses are much lower. Also, I feel a lot more in control of my emotions, yep, my emotions.
When things come up, I now take the time to make sure that whatever action I take won’t derail my goals. Before I would always react super quickly when different situations cropped up. I was constantly dealing with a lot of anxiety and it affected my ability to think clearly when dealing with financial situations. Making decisions in this way kept me in the hole.
No more.
I want a healthy and substantial savings. To me a savings is like is a life line. After so many years of being in debt and barely scrapping by I’m over it. I’m also over being 30 pounds overweight-but that’s a post for another day.
I will continue to pay off debt through side hustles, thrift, and frugal living. By embracing the harder debt repayment process I’m hoping to learn some life long lessons. I look forward to building my wealth. I’m over scrapping by all the time.
This year’s windfall goes to me. Not for shopping, not for going out, and not for home improvements. It’s for me and it’s about damned time I realize that I come first.
What do you do with windfalls? Do you find saving difficult? What saving percentage do you aim for every month?
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My savings rate is abysmal, as I am using the extra cash towards debt. Except for right now, when I am saving up for taxes because we owe :/. Even so, I continue to save SOMETHING for retirement each month, usually between $100-$200.
As for the weight loss thing, I’m hoping the weight starts coming off pretty soon. We’ve cut down our alcohol consumption by over 2/3rds and have started cooking delicious, healthy, vegetarian meals at home. I always said I can’t cook worth a damn, but I am churning out the delicious veg meals lately! Maybe meat is just my blind spot?
I just got turned off of meat a couple of weeks ago after I had the flu. I can’t eat steak/lamb right now. Maybe that will kickstart my weightless? I am trying to keep focused on my debt repayment but I don’t want to be cutting things too close. I am so sick of living just on the edge for so long. The reason why I would backslide and use my credit cards was that I didn’t have enough cash on hand. I’ve decided to amp up my savings so I feel a lot more secure. I like see all of the zeroes.
HI Michelle! Windfalls either go towards the mortgage or house repairs. One day I hope they can go towards holidays!
We’re aiming for a 51% savings rate this year.
That is a rock star savings rate! I am hoping to hit 50% by year’s end. I just had to recalibrate my plan and pump up my accounts. I think it will help me avoid using credit cards for things that I could just use cash to take care.
“If you look at a person’s savings you can judge how they feel about themselves.” I really like that! My savings isn’t exactly where I’d like it to be right now, so it’s something I’ve been working on. I haven’t actually calculated my savings percentage before. I’ll have to figure it out and get back to you.
That was an amazing quote that I read recently. It made me really think about what I’m communicating to myself via my daily actions. The way I take care of my money, health, etc. I’m shifting my focus to savings for the next month or so and then going back to accelerating my debt repayment. Can’t wait to hear what your percentage is! My goal is to hit 50% by the end of the year.
it seems like you are on a really good path this year! How I save is, I take certain percentages out of each paycheck, no matter how big or small, and put them into various savings buckets. So that number will look different each month. If I get a windfall, I treat it the same way.
I’m really focusing on savings because out of all of the things I have tasked myself with this year this is my weak spot. Savings is a Non-negotiable. I used to be really good at it-everytime I was planning to go abroad.