The Saving Secret Worth $366,000

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The I Hate to Save-Kick in the Butt

Latest news just in from Sun Trust Bank Survey: “Many higher income households are living paycheck-to-paycheck”

We are notoriously bad at imagining our future. In fact I remember playing with my Great Aunt as an 8 year old and thinking, “I’m never going to be this old, ever”. Then I remember thinking about how old I’d be when the new millennium came, and the same thought reoccurred, “I’ll never be that old”.

This inability to image the future is a problem.

Whether you can imagine it or not, the future will come for most of us, and along with the future will come kids, bills, vacations, homes, expenses, and ultimately retirement. During those decades there’ll be plenty of upsets, smaller problems like a blown tire to life changing medical scares, and retirement.

Here’s the deal, if you ignore the future, or avoid it, you’re going to have problems.

secret to saving

The Sun Trust Survey (conducted online by Harris Poll) found:

You’re not saving enough.

These findings apply to those households that earn $75,000 or more per year. 

  • Almost a third of those households which earn $75k or more live paycheck to paycheck, at least part of the time.
  • Forty four percent admitted that the worst causes of under-saving were over-spending on eating out and entertainment.
  • Seventy one percent of millennials confessed that eating out and entertainment kept them from saving enough.
  • Only 37 percent of those ages 45 to 54 believe they are saving enough to live comfortably in retirement.
  • Thirty three percent owned up to the fact that a “lack of financial discipline”, at least some of the time, keeps them from reaching their goals”.

Simple Saving Secret Solution {Part 1}

If this research is correct, then here’s half of a simple fix.

  • Go to the grocery.
  • Buy some food.
  • Cook it and eat it at home.

I dislike cooking as much as the next person, but most nights, I cook.

Why?

Because I like having the freedom that money provides.

By practicing simple cost cutting lifestyle hacks, you can turn small amounts of money into big bucks. This simple saving secret is no more than a habit. 

Quit Making Excuses:

“I’m too tired.”

“I don’t want to cook.”

“It’s too much work.”

“I don’t have time.”

“I don’t know how.”

Ask yourself one question?

“Do you want to be poor as you age?”

If the answer is yes, then continue doing what you’re doing, eating out and splurging on entertainment.

If not, then commit now to making a few small lifestyle changes.

The secret to getting rich {without winning the lottery}-click here.

Small Change = Huge Gain

Here’s the deal. You don’t have to reinvent your life…. because that is way too hard. But if this Sun Trust research is right, you probably should boost your savings a bit.

Simple Saving Secret Solution {Part 2}

The Easiest Way Ever to Boost Your Lifetime Savings

Here’s an easy two pronged approach to boosting savings and your ultimate financial well being. Let’s incorporate the “kick in the butt” from Part 1 and drill down into making a small change for a big financial gain.

First, as we mentioned above, make a weekly trip to the supermarket and stock up. Get snacks to bring to work during the day. Get stuff for the kids lunches and your own. And finally buy some easy-to-fix dinner items. At night have the family make their own lunches for tomorrow-everyone. In the evening, have everyone pitch in to make dinner. If you’re really crafty, throw some stuff in the crock pot in the morning before work.

Second, visit your human resources office, ask for the form to have part of your paycheck transferred into a savings or discount brokerage account. Next, just have a small amount of money taken out of your paycheck and transferred into a discount investment brokerage account. Then tell the brokerage account to invest this money into a diversified, low cost index fund such as the Vanguard Total Stock Market Index Fund or the Vanguard All World Stock Index Fund.

Now, here’s the fun part, how much can you really save?

If a family of 4 bought lunches out 5 days a week, you’re likely spending about $150 per week. Let’s slash that in half by bringing lunches most day. {Do your best, you don’t need to be perfect, just make a small change towards saving more.}

Save $75 per week from this small change and transfer that savings into a discount investment brokerage account which earns an annual 7% per year. Invest the $300 savings per month and after 30 years, that one habit change adds up to more than $366,000 dollars. That’s a lot of money for a small habit change.

Click here to learn how to invest your hard earned dollars {and beat the returns of the pros}

 The Takeaway

Building a wealthy life isn’t about the big changes, but about making small adjustments in how you choose to live and spend. Have a bit of foresight and imagine the you of tomorrow. Allow yourself to accept that life is both about today and tomorrow. Then, take care of your future self by making a few small adjustments in your present lifestyle. Who knows, you may just be $366,000 richer tomorrow.

 {Caveat, transfer money into a stock market index fund only if you can commit to leaving it there for a minimum of 5+ years. The financial markets are too volatile for money you’ll need in the short and intermediate term. Otherwise, keep the money in a savings or money market account. This is not a recommendation to buy a specific investment but a hypothetical example; consult your own advisor for financial guidance}.

 

 

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