In today’s tough economy it can be difficult to put away some cash and keep it there. According to the U.S. Department of Commerce’s Bureau of Economic Analysis, the personal saving rate in December was 4.8 percent, up from 4.5 percent in November. The personal saving rate is calculated by subtracting what Americans spend from what they make. A recent article in Florida Today newspaper discussed the importance of saving.
Motivation:
Emergencies are one of the most important reasons to save some cash. The next reason should be retirement and then saving up for something you really want like a new car or television. Here’s a rule of thumb: have enough money to live on for six to 12 months. And it’s important to consistently put money into it, says the article.
Teaching Kids:
I remember getting my first piggy bank and I was so excited when I was able to drop a few dimes or quarters into it. Encouraging our kids to start saving early is important for their future. Here’s a tip: teach them to divide any money they earn or get into two piles. put half in the bank and keep the other half or spend it. Also, teaching kids how credit cards work is important as well. According to a 2008 Sally-Mae credit card study, college seniors graduated with an average of more than $4,100 in credit card debt.
Stick to a Plan:
Keep to a budget no matter how difficult things may seem. Continue contributing to your 401(k) and continue stashing away some cash. When it comes to retirement, start saving NOW, says the article. First, you can analyze your spending and expenses. Try cutting back and look for free entertainment or cook more at home. One thing my husband and I do is keep loose change in jars. When they fill up, you can take them to the bank.
Easy Ways to Save:
$15: Amount you can save each month if you stash 50 cents a day in loose change.
$6: You can save this amount per month if you cut back on soda by 1 liter per week.
$40: Monthly amount you can save if you switch from cappuccino to regular coffee.
$25: Your monthly savings if you pa your credit card bill on time.
Check out America Saves for some more tips and help.