“I save money when I’m working so I never have to take a role just for the money.” Gary Sinese
I like hearing movie and television actors espouse smart money habits. It hammers in the importance of saving, regardless of
- SAVE MONEY
Main Topic; Tax Time Has an Added Benefit
I’m finally getting around to organizing our family records so I can complete our tax returns. In addition to W-2’s we have royalty income from published books, income from consulting, and dividends, interest, and capital gains. Before you turn away in disgust, let me say El Carino and I have been working many many many years in order to build up these revenue streams. We have devoted lots of time and money to education….. and many hours to work outside of the typical 9 to 5 gig.
I was somewhat surprised when I complied all of the 1099’s and various tax forms. I certainly don’t feel like we are swimming in cash. Of course with a daughter in college, the money goes out rather quickly.
Practical Application; Out of Sight Out of Mind
The reason these tax forms caught me off guard is this; almost every bit of our additional income goes immediately into savings. And a big chunk of our regular salaries goes into retirement funds. So the actual money we have in our checking account, which we use for our living expenses is rather modest. We live a life free of excess and filled with lots of low cost fun.
I realized something that the famous financial writer, Jane Bryant Quinn stated in one of her many books; If you don’t see money in your account, YOU WILL NOT SPEND IT.
Her budgeting advice was brilliant, transfer a set amount from your paycheck into savings, and spend the rest. You’ll build up savings and you will learn to make do with what you have, not the other way around.
Instead of saving what you have left at the end of the month, which won’t be much, save at the beginning, and spend what’s left. Trick yourself into thinking that you have access to less cash and I promise, you won’t miss it.
Say no to a couple of extravagances during the month, and over time, your net worth will grow.
ACTION STEP:
Get a notebook and label it: “(your name) Personal Finance” and keep it by the computer. Use it to keep all of your personal finance goals, thoughts, activities, and plans.
Even if you already have money transferred from your paycheck into a retirement account, have a bit more transferred into a savings or brokerage account. Write in a let me know if you miss it!
And if you don’t have any automatic savings, get started NOW, having money from you paycheck transferred into a retirement and savings account.
What are your tricks for keeping cash from flying through your fingers?
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image credit; John-Morgan
