Make Saving a Habit

Are you saving some of your income? Do you barely get by until the end of the month? Would an emergency trip to the dentist or an unexpected leak in the plumbing wreck your budget? Couples with no savings or emergency fund can find themselves in a bind when unplanned expenses come from the blue. What's more, money problems can lead to other problems. That is why having a regular savings plan is so important.

Saving requires tough decisions. In order to reach savings goals, you may have to give up some things. What you give up depends on what you and your spouse value most.

(2) Having an emergency fund equal to 3 to 6 months of your take-home pay to cover temporary loss of income due to a layoff or job loss.

As you will soon learn, there are many ways to save. However, the most important thing to remember about a savings plan is to keep it simple and steady. If you make saving automatic, it will be easier to stick with your program.

A plan for saving and investing is an important part of a household spending plan. Begin today to build your savings for a financially secure future.

Overspending can be a barrier to saving. To solve a problem, it must be identified. Here are some signs of a chronic overspender. Check "yes," "no," or "sometimes" after reading each question.

Yes	No	Sometimes
			1.	Are you still paying bills from items you bought a year ago?
			2.	Do you use credit cards instead of cash, even when the purchase is small and you have the money?
			3.	Is your checking account frequently overdrawn?
			4.	Do you race to get your paycheck to the bank before the checks you've written come through?
			5.	Are you often out of money by payday?
			6.	Have you stopped having, or adding, to a savings account?
			7.	Do you feel "out of control" when faced with a purchasing decision?
			8.	Do you juggle payments one month to the next, trying to keep your creditors satisfied?
			9.	Are your credit cards at the maximum credit line available to you?
			10.	Do you sometimes pay off a debt only to find your self feeling free to spend more?
			11.	Would a small change in your income or an unusual expense throw your whole financial picture into chaos?
			12.	Do you hope your children will handle money better than you do?

If you answered "yes" more often than "no," you are probably an overspender. In order to get your finances under control, acknowledge the problem. Find ways to change your spending habits, so you will have funds for a savings account.

How can you save when you don't have a dime to spare? Check the tips you are willing to try.

	1.	Pay yourself first. When you pay your bills, pay your savings bill by depositing the money in your savings account.
	2.	Use payroll deductions. Have your employer deposit your savings directly into a credit union or bank account.
	3.	Save "bonus" income. Save tax refunds, overtime pay, gift money, refunds and rebates.
	4.	Save coupon money. Save the amount you "save" by using coupons at the grocery store. If you save $2 a week using coupons, put the "savings" (the money you did not spend) in your savings account.
	5.	Pay installments to yourself. Once you pay off a loan (and if other loans are not overdue), continue to make "payments" to your savings account.
	6.	Collect loose change. Empty your pockets and wallet of loose change and place in a jar. Once a month, deposit the change in your savings account.
	7.	Break a habit. Every time you don't have a donut at coffee break or don't buy a soft drink, save the money you didn't spend.
	8.	Save the lunch money. Get up 10 minutes earlier and make your own lunch. Save money you would have spent on lunch.
	9.	Save money on sales. Save the difference between the sale price you paid and the "full" price you would have paid if the item had not been on sale.
	10.	Have a "nothing week." Once in a while have a week when you try not to spend any extra money. Save the money you would have spent.

If both you and your spouse will make a commitment to save $1.67 each day, by the end of the month, you'll have $100. It's that simple.

For example, let's say your goal is to take a vacation in three years. You think you'll need $700, and you plan to save at your bank, which pays 2 percent interest. You can use the worksheet below to estimate the monthly savings you'll need.

Shop around for the best interest rate. In the example, if you could earn 3 percent at a credit union, you would need to save $18.90 per month for the $700 vacation – that's $4.36 per week or just 62 cents a day.

Worksheet – Monthly Savings Plan
Goal	A Amount Needed	B When Needed	C Sinking Fund Factor (Refer to Table)	D Yearly Savings Needed (A x C)	E Monthly Savings Needed (D÷12)
Example: Vacation	$700	In 3 years	.324	226.80	18.90

Money you will need to meet emergencies and short-term goals must be convenient and readily available. You will want it in an account that is safe. Most savers keep emergency money in passbook savings account or a money market deposit account. Both of these accounts are federally insured. Both types are offered by local financial institutions. Either account is easy to open but does require a minimum deposit. Check with local banks for more information. Do not confuse money market deposit accounts with money market mutual funds. Money market mutual funds, although relatively safe, are not federally insured deposits.

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Money and Marriage Issue 4. Make Saving a Habit

Money and Marriage
Issue 4. Make Saving a Habit