Results 1 to 10 of 10

Thread: Help! I suck at saving money.

  1. #1
    Featured Member Tourdefranzia's Avatar
    Joined
    Jul 2013
    Location
    Portland, OR
    Posts
    1,445
    Thanks
    649
    Thanked 3,393 Times in 970 Posts

    Default Help! I suck at saving money.

    I'm carrying a lot of debt right now, and want to put all my extra money toward paying down that debt. It is just so difficult to know how much I should be putting away vs how much I'll save by eliminating principal on credit cards, car notes, student loans and business loans.

    This is a difficult position as I do live within my means now, but had a rough patch financially a few years back, that's why all the debt is still hanging around my neck. Pretty much all savings accounts don't pay enough to beat inflation, it just makes sense to me to pay down my debts as fast as humanly possible.

    I intellectually understand why having some savings is necessary, but today the numbers just don't pencil out. Unless anyone has some suggestions where I can earn a rate of return that actually beats inflation, that would be wonderful!

  2. #2
    God/dess shanna dior's Avatar
    Joined
    May 2008
    Location
    Canada
    Posts
    4,980
    Thanks
    621
    Thanked 6,894 Times in 2,672 Posts

    Default Re: Help! I suck at saving money.

    Tackle whatever debt has the highest interest rate.

    Depending on where you got your student loan from, that's probably the cheapest loan you'll ever get and is less of a priority than your other debts. You obviously know best though, so, again, focus on the interest rate. Regardless, it's worth reaching out to whatever entity you got it from to see if there is an interest grace period or repayment assistance program that you might be eligible for.

    If you think you can pay off the credit card debt in 12-18 months, consider transferring the balances on those credit cards to one card that has a 0% APR promo period (usually 12-18 months, depending on the card) and a 0% balance transfer fee. I'm not recommending any of the cards on this site, but here are some that might be worth researching: https://www.nerdwallet.com/balance-t...r-credit-cards This would at least cut down on your debt growing while you're working to pay it off.

    Now, while I get the urge to put EVERYTHING towards your debt to get it all gone, resist it. I know you don't want your savings sitting there and "losing" value since they're not keeping up with inflation, but you do need some liquid assets in case of emergency. Open a high interest savings account with credit unions or reputable online bank that has a decent interest rate and transfer your emergency money there. They often have better rates than the big banks, and then you'll still have it easily accessible if anything happens but it won't just be sitting there as uselessly for the time being.

  3. The Following 2 Users Say Thank You to shanna dior For This Useful Post:


  4. #3
    God/dess Zofia's Avatar
    Joined
    Apr 2002
    Location
    Durham, North Carolina
    Posts
    2,417
    Thanks
    2,964
    Thanked 2,370 Times in 934 Posts

    Default Re: Help! I suck at saving money.

    A different, though not better or worse, is pay minimums on all your debts, except the smallest. Pay as much as you can over the minimum on that debt. Get it paid off and move on to the next smallest. Sometimes success breeds success.

    Shanna is right, don't worry about saving right now. Just reduce your debts.

    Another idea is to economize. Some ideas: eat out less, keep your current car longer than planned, take in a roommate or boarder, buy foods in bulk that you can store rather than over priced stuff at the full price super market. I used to be a big believer in farmer's markets. Not so much anymore. Our local market has gone nuts with "farmers" trying to sell hand raised, organic, non-GMO, heritage kale for about $11/pound. Sorry, dude you're just too proud of that lettuce for my taste. Kroger sells it for $1.49/pound.

  5. The Following 5 Users Say Thank You to Zofia For This Useful Post:


  6. #4
    Featured Member minnow's Avatar
    Joined
    Sep 2007
    Location
    USA
    Posts
    1,003
    Thanks
    242
    Thanked 519 Times in 315 Posts
    Blog Entries
    10
    My Mood
    Twisted

    Default Re: Help! I suck at saving money.

    I agree with gist of what Shanna and Zofia say about tackling debt first, yet still keeping an adequate saving cushion.
    What exactly adequate savings cushion should be varies with individual. Many "pundits" suggest an ammount equal to 3 months salary. Some say 3 months living expenses. It sounds like you have that level, whatever it is.

    As for prioritizing how much to pay off debts per month, the following factoids should be a sufficient motivator:

    1) At todays measly savings rates, it will take you an average of 700 years to double your money.
    2) If you're paying the kind of interest rates that I think you are on some of your debts (thinking double digits), your debt load would double in 4-6 years if you didn't make any payments during that time.

    Of course, no creditor is going to just sit back and let that happen, but you can now really see what kind of drag that is putting on your finances, and the stark difference between savings account doubling money, and debt load doubling. Shoot, a 10 year bond at todays rates won't double your money in 10 years.(It would actually take ~32-36 years.)

    While Zofia is on the subject of grocery stores, do you have a fuel rewards card from your regular store ? Even if you save just $1 per month on gas, that would probably be more than what a $10K savings account would pay in monthly interest. HTH
    I'm right 96% of the time. I don't sweat the other 5% .......................

  7. The Following 3 Users Say Thank You to minnow For This Useful Post:


  8. #5
    God/dess Flickdreams's Avatar
    Joined
    Aug 2009
    Location
    Look behind you....
    Posts
    3,406
    Thanks
    5,155
    Thanked 4,132 Times in 1,638 Posts

    Default Re: Help! I suck at saving money.

    Saving this thread to link to my thread re. budget. I feel you Tourdefranz, I really do.
    Tiny tweaks----->BIG CHANGES

    Quote Originally Posted by Kirakonstantin View Post
    More fear-mongering? Really? Yes, this is not the 1990's anymore. Yes, things are changing. Either dance or don't. Freaking out and sowing fear isn't going to help anyone.




  9. The Following User Says Thank You to Flickdreams For This Useful Post:


  10. #6
    God/dess Zofia's Avatar
    Joined
    Apr 2002
    Location
    Durham, North Carolina
    Posts
    2,417
    Thanks
    2,964
    Thanked 2,370 Times in 934 Posts

    Default Re: Help! I suck at saving money.

    Another thing you might want to think about is bankruptcy. Depending on your assets and your job, bankruptcy is a very effective way of dealing with creditors who are otherwise unreasonable. The big caveats are student loans and home mortgages. Student loans are generally not dischargeable and if you want to keep the house, you have to pay for it even in bankruptcy. Don't let people tell you that bankruptcy will ruin your credit. Delinquencies will ruin your credit. So if you are late on a bunch of your credit cards, your credit score is already hurting. If you are current though, bankruptcy will hurt your credit score. Still it's something to think about.

  11. The Following 2 Users Say Thank You to Zofia For This Useful Post:


  12. #7
    God/dess Flickdreams's Avatar
    Joined
    Aug 2009
    Location
    Look behind you....
    Posts
    3,406
    Thanks
    5,155
    Thanked 4,132 Times in 1,638 Posts

    Default Re: Help! I suck at saving money.

    ^ I love women who know finance; i love being surrounded by and advised by women who know finance!
    Tiny tweaks----->BIG CHANGES

    Quote Originally Posted by Kirakonstantin View Post
    More fear-mongering? Really? Yes, this is not the 1990's anymore. Yes, things are changing. Either dance or don't. Freaking out and sowing fear isn't going to help anyone.




  13. #8
    Featured Member Tourdefranzia's Avatar
    Joined
    Jul 2013
    Location
    Portland, OR
    Posts
    1,445
    Thanks
    649
    Thanked 3,393 Times in 970 Posts

    Default Re: Help! I suck at saving money.

    Quote Originally Posted by Zofia View Post
    Another thing you might want to think about is bankruptcy. Depending on your assets and your job, bankruptcy is a very effective way of dealing with creditors who are otherwise unreasonable. The big caveats are student loans and home mortgages. Student loans are generally not dischargeable and if you want to keep the house, you have to pay for it even in bankruptcy. Don't let people tell you that bankruptcy will ruin your credit. Delinquencies will ruin your credit. So if you are late on a bunch of your credit cards, your credit score is already hurting. If you are current though, bankruptcy will hurt your credit score. Still it's something to think about.
    Thank you! I know that bankruptcy isn't the right choice for me, as my debt is manageable and my credit score is ok (652). I know my credit score would be much higher if I had a better debt to income ratio, that is why I do my best to pay down my debts.

    I just need to learn a way to motivate myself to save some money in case of emergencies. That way I'm not stuck pulling out the credit cards when unexpected expenses happen, like car repairs or sick days.

  14. #9
    Veteran Member Candycups's Avatar
    Joined
    Oct 2014
    Location
    USA
    Posts
    233
    Thanks
    234
    Thanked 501 Times in 172 Posts
    My Mood
    Cheerful

    Default Re: Help! I suck at saving money.

    The club I'm working at now has a system in place where they give the girls who show up for opening on the weekdays $40 in funny money if they stay the full shift. I just cash it out at the end of my shift before I leave and lump it in with the rest of my money, but I've seen a lot of girls save it up instead. They lock the funny money up in their lockers and take their cash home. From there, some of them cash it out once a month, and others keep it saved as an emergency "oh shit" fund. Granted, it's easy to set that aside because it's not real money. You can't take the club's plastic version of a mythical currency to a grocery store or to pay your bills. You need to get it cashed out and converted before you can use it. It's a lot harder to set aside a $20 bill or two each shift and know they're there, if you're ever just a smidge short on something.

    Something you might do that might be a little more suited to your income, regardless of what it is, is to tithe yourself. To make it easier, you could even just tithe each full hundred. So if you make $270, you pocket the $70 and save the 10% from the 200. It's your call how much those $7 matter to you. If you're in a tight situation, every dollar counts, and you might want to keep those $7 handy so you're not tempted to dip into your savings. The whole point of the savings is that you don't touch it, so only save what you know for sure you can spare/won't need. Don't worry if all you can spare is a couple bucks -- it adds up. Then forget that money exists. Maybe get a piggy bank that you need to smash to retrieve the money -- deposits only until you absolutely need it. Otherwise, consider that money gone. It might as well not exist. It is unavailable for spending. With tithing, if you have a bad day and only leave with $100, you don't need to set aside $40 of it into a savings you're not supposed to touch, because you're probably going to touch it a lot if you only have $60 to work with. But if you have a great day and leave with $1,000, by all means, set $100 aside, because you can afford to do that today, and you might not be able to afford to do that tomorrow.

    Depending on your income situation, you might even say that if you make less than X amount, you won't set anything aside, or you'll only set aside X% instead of 10% or 20% or whatever you normally save. Putting money into savings is a really important first step, but the BIG thing is to remember not to touch it. You can put aside 100% of your earnings, and it means nothing if you use it to pay all your daily bills and whims. Again, the big thing is not the amount of money you set aside, it's your ability to leave it there and not touch it at all, ever, no matter how small the amount you need from it, no matter how sure you are "you'll make it back tomorrow/in a couple days." Whatever your thing is, unless it's a life threatening emergency, it can wait for you to make the money "tomorrow" or "in a couple days" and buy it then. Only spend money you have on hand right now. Don't borrow against your future self by spending money you don't have yet.

    Anyone can set money aside in a safe place. It takes a lot of psychological brain trickery to keep it there.

  15. #10
    God/dess Selina M's Avatar
    Joined
    Jan 2013
    Location
    Omicron Persei 8
    Posts
    4,508
    Thanks
    12,529
    Thanked 13,934 Times in 3,720 Posts

    Default Re: Help! I suck at saving money.

    Quote Originally Posted by Tourdefranzia View Post
    Thank you! I know that bankruptcy isn't the right choice for me, as my debt is manageable and my credit score is ok (652). I know my credit score would be much higher if I had a better debt to income ratio, that is why I do my best to pay down my debts.

    I just need to learn a way to motivate myself to save some money in case of emergencies. That way I'm not stuck pulling out the credit cards when unexpected expenses happen, like car repairs or sick days.
    I've found the best thing is to set aside 3 months of expenses and THEN tackle the debt. I know the finance whiz people are like "But that's costing you interest in the meantime!", but it'll save you a lot of stress if you have another rough patch. Mentally, I feel that it's better to have that saved money than put a month of expenses back on the credit card, when it'll make you go "Ah shit, that just undid all my debt pay down" and lose motivation. Better to be in debt to yourself than a credit card, IMHO.

    I save 2 ways, both similar to Candycups tithing, except I'm tithing to myself... may sound OCD but it works for me:
    1) when everything is good and on track: each shift I pay 1 bill out of it, take a % for tax, and then see what's left. If there's at least $120 left, I'll stick the $100 in savings and give myself the $20 or w/e is left. I do $100 increments saved because I like the round number. If there's not enough left over to do that, I pocket the rest and just check again the next shift. I do this bc I find it very un-motivating to go to work if I'm not putting at least SOMETHING in my wallet to spend after every shift. Once I hit a goal for the month, I keep all the extra $$ for fun.
    2) when I had to take $$ from savings for some reason: literally everything goes to the savings and I give myself $40 max out of each shift, again to save my sanity and not 'feel broke' if that makes sense.
    "People jack off with the left hand and point with the right."

    "You can check out any time you like, but you can never leave."

Similar Threads

  1. we type about saving money....
    By bustybabe312 in forum Stripping (was Stripping General)
    Replies: 0
    Last Post: 05-24-2011, 01:28 AM
  2. SAVING MONEY - how do you do it?
    By anouk.oui in forum Dollar Den
    Replies: 16
    Last Post: 08-22-2010, 06:30 PM
  3. Saving your Money
    By katie941 in forum Dollar Den
    Replies: 34
    Last Post: 10-24-2007, 01:42 AM
  4. Saving Money
    By RC in forum Dollar Den
    Replies: 9
    Last Post: 06-21-2007, 06:19 PM

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •