How to Save

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The car needs tires?  Want to go on vacation? Back to school shopping is coming up… How does one save for the future when you want to live today?

There’s no quick solution other than through discipline and savings can you break the cycle.  First, establish a budget.  Everything you spend money on house, car, insurance, groceries, bus or gas, phone, dining out, clothes, medical, etc. etc.

The very first item on your budget is SAVINGS, PAY YOURSELF FIRST.  With the first goal being accumulating 3 months of your bills.  Aim for 6 months of expenses, and this a fund you don’t touch.  Not for movies, car parts, trips… That is money is the foundation for your safety net.

Discipline, self-control, by paying yourself first before entertainment or other expenses, you build your next egg for your future.  Have your paycheck directly deposited into the bank and then set up automatic transfers to your savings account, a good banker can help you set this up.    One note of clarification: money in a savings account is safer than money at home in a box or under your bed. Minimize your risk and increase your safety by using direct deposit so your paycheck is available faster.

GOALS- after you have built a cushion of 3-6 months to handle emergencies, develop goals like retirement, vacation, college, down payment for a house.  Transfer additional funds to satisfy these goals into your savings account.  And by the way, a savings account is different than a checking account.

After the budget is established, and you show discipline by paying yourself first, meeting your goals, you are now in a position to invest.  Whether a CD, mutual funds or bonds.  Also, consider how much debt you have, especially if you have high-interest credit card balances.

Establishing financial goals and focusing on meeting them through discipline builds wealth and provides opportunities, comfort and enjoyment for you and your family.  Additional benefits are improvement to your community and neighborhoods, by breaking the wealth gap.   I highly recommend reviewing your goals annually and whenever there is a life change, such as marriage, birth/adoption of a child, divorce, illness or job changes.

Through discipline and planning, one can change the cycle of poverty and permanently change you and your world.

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