The concept of saving money is very simple: Don’t spend everything you make. Put some away into savings. Actually doing savings is much more difficult. Right? However, there is one common theme I keep hearing no matter which financial guru I happen to see on t.v. or read from. Here it is: PAY YOURSELF 10% OF YOUR INCOME BEFORE YOU PAY ANYONE OR ANYTHING ELSE! (this includes creditors, collection agents, the grocery store, your mp3 habit, Bob’s Steak and Rib Pub, etc, etc, etc.)
Now before you lose patience with me because you either think this is too simple to work, too dumb to work, or simply not worth it let me assure you - It is the best possible way to start on your path to financial prosperity. Having been hugely in debt and low on cash flow a mere 5 years ago I can attest to the effectiveness of using this method. It’s absolutely amazing how quickly a nice little cash cushion can add up and be there for you in case of a real emergency or an opportunity to pay off debt. It can also be rolled over into investments if your debt is paid off. The key is that you have to give it shot, work it consistently, and be rewarded with the gratification of not being a part of the status-quo who don’t have a pot to “you know what” in.
I recommend using an ING Direct account to put your savings in. ING is currently paying over 5% interest (which is about 4.75% more than your bank will likely pay you in your savings account.) and it’s easy to set up and use. One nice feature is that is takes a couple of days to transfer money back and forth. This can keep you from spending your money on impulse but won’t keep you from using it in emergencies.
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