Savings should be a priority; however, according to a recent study published, over half of millennials (52 percent) have less than $1,000 in savings.
I wouldn’t be hard-pressed to believe this as it seems that the majority of us graduate from high school with a less than stellar financial education.
Tack on the fact that student loan debt continues to rise and graduates have a hard time finding jobs after college — savings is the last thing on many millennials’ minds.
Many of us know that saving is critical to get ahead. We’ve been preached to about the importance of paying yourself first.
However, those teachings fall to the wayside for many when those bills come. Then there are the times you just want to forget about them and pretend to live a carefree life
I know how important it is to save and I finally sensed up and began before it was too late. However, many of my peers don’t.
Savings shouldn’t be an afterthought — something you do when all of your bills have been paid and you’ve been thoroughly entertained.
It should be the first thing we do because jobs are not promised and even self-employed individuals aren’t promised a steady income.
So to protect yourself from all of these financial perils, savings must become the number one priority, not just for millennials — for everyone!
Every once in a while, I like to improve on some of my existing savings habits and strategically think of ways I can cut back on unnecessary spending.
In my opinion, unnecessary spending takes place because all of our money hasn’t been given an assignment.
If I have leftover money and I’m blowing it on random ice-cream runs, the Target dollar spot, or unplanned Kindle purchases, this means I haven’t made saving my number one priority.
It’s okay to spend money on extras, as long as money is allocated in your budget for extras.
Not because you have leftover money to throw around on these random things. So, I’m experimenting with an idea to make sure I’m not leaving extra money on the table at the end of the month.
I’m paying myself a $5.00 fine for compulsive habits to boost my savings.
I mentioned in my post Teaching Our Kids to Spend, Save, and Give, that my husband and I are joining our daughter in a savings challenge. Each of us has our own savings goals and are saving alongside each other.
To ensure that I properly fund my savings jar, I’m taking out extra cash when using my debit card and saving whatever cash I may have on hand. However, I’m taking things one little step further.
Lately, I’ve developed a terrible habit of indulging my inner sweet monster. I’ll get a craving and go to the store to buy a pack of Reese’s (several, I might add) or a quart of ice-cream (usually two...no lie...Publix Brownie Monster Tracks, for further clarification).
I don’t need these things and I’m very aware of this desire to purchase these items are compulsive wants. I’ve been paying myself a $5.00 fine for every time I give in.
This is in addition to taking extra money out to meet my savings goal challenge. I should have that new set of pots and pans in no time if I get over the guilt trip I have every time I have to pay myself that $5.00.
This process really makes you consider every purchase and many times I’ve resisted my inner sweet monster because a $6.00 Reese’s Cup doesn’t sound as appetizing.
Yes, I know I’m paying myself, but the thought of going to the store and making a $1.00 purchase, and the receipt showing you actually paid $6.00 — this makes you reconsider little orange packages that contain incredibly delicious treats.
If the store doesn’t give cash back (many places may charge a fee), simply go to the ATM or use cash if you have it on hand (no biggie). However, remember some of the cash you get from the ATM or the cash you have on hand must cover your self-imposed $5.00 fine. Don’t try to find a way out of it with logistics!
Trust me, it’s really working and it may just work for you too!
If you are lacking in the savings department and have compulsive habits that need to be addressed, this may be a great challenge to help jumpstart your savings. Young people, don’t be a part of that 52 percent that have less than $1,000 in savings.
We have to do better! You need an emergency fund or a -ish happens fund. You know -ish happens. It really does. The only way to protect yourself is to start paying yourself first. This process is taking the headache out of it and providing you with a fun challenge.
If you’re not ready to say goodbye to your habits, pay yourself $5.00 for every indulgence. If you’ve got it really bad, you’ll be on your way to developing some solid savings habits. And don’t worry ― once you’ve got those savings muscles warmed up, there are plenty of other great ways you can save too that don’t involve paying fines to yourself.
Don’t wait to begin building your savings, start today!