For 2012, I wrote a list comprising of about 10 goals that I want to focus on this year. Most of them involve implementing a healthier lifestyle so that I can lose weight. A few are about tackling my rising debt. But this resolution is so easy and important that I can’t hide it. It is the number one easiest thing to do in order to make your life better:
Save 10% of your weekly earnings in a separate savings account, and don’t touch it.
Everyone knows how important it is to save money. Emergencies happen. Cars break down. Kids need braces. Textbooks need buying. The deductible on your insurance isn’t going to pay itself. But how many of you actually save money for these emergencies? Keeping a budget is even harder. Some days you just really want a $4 coffee . . . or a $50 pair of shoes. It’s hard to feel like you have no fun with your money. I decided to create this goal for myself because I need to save money for many of life’s surprises. I also need help saving money so that I can tackle my debt in large sums of money. And those student loans are going to be due sooner than I think. 10% is such a minuscule amount of money, no one will miss it. And it is big enough to accumulate quite rapidly when you stop paying attention.
Let’s see the math in different hypothetical situations. Let’s do a college student,working part time, earning minimum wage. Let’s say she earns about $150 per week (if she’s lucky). 10% of 150 is $15. (Hate math? Move over the decimal point one spot to the left. Boom. 10%). Putting away $15 per week isn’t hard. It’s painless. She won’t even feel it. In 8 weeks, she’ll already have $120 in her savings account. JUST FROM PUTTING AWAY 10%. In an average semester of say, 20 weeks, she’ll have $300. That’s almost enough for next semester’s textbooks (or a couple new outfits). All that money without even missing it. Take a wild guess how much money she would have had if she didn’t commit to saving just 10% each week. Nada. Zilch. $0.
Let’s change the scenario. Let’s say the person is now working barely above minimum wage, but full-time. For simplicity purposes, let’s say the person earns about $400 per week. 10% of $400 is $40. See what I did there? In one month she’ll already have $160. In a year she could have just over $2000. Just from saving a measly 10% of her paycheck every week.
For illustration purposes, this doesn’t include extra income earned from tax refunds, bonuses, birthdays, or an increase in pay or hours. If you put that money away, too, the amount will obviously be even more awesome.
This goal is easy to do and painless. You won’t miss 10%.