How Y’all doing?
There are several ways to save and may different things to save for, so I thought I’d elaborate.
Mr.B likes to micro-manage so he has accounts and saving jars for literally every single goal; one for car maintenance, one for emergencies, one for treats, etc.
I have 2; one for short-term (emergencies or saving up for bills) and one for specific long-term plans.
Either is fine as long as we save. You can save change in a jar (Mr.B does that too) or use cash envelopes or ISAs and investments. The choice is yours and it may be that you have different types for different things (an account with interest for the long term, but a coin jar for birthday cards and gifts).
The amount you save and increments you save up in is also up to you (and your spouse, if you’re married). Depending on your income, you can save daily, weekly or monthly (ideas for savings plans can be found on my Pinterest Budgeting page).
After checking you can afford a set amount and doing that, there are different ways to increase it.
- You can do it the Dave Ramsey way: $1000 emergency fund, then keep saving until you have 3-6 month’s worth of your income, then focus on long-term goals.
- Increasing by a penny a day or by a percentage per month or year as you can afford it.
- Find an extra source of income and throw all of that into saving.
- You can split your savings equally between goals or on a pro rata basis (biggest goal gets most per month).
- You can work on your finances (increase income/decrease debt and unnecessary expenses) until you have 20% available to save and save that 20% for everything. This is true to the Old Testament teaching and many Christians aim for this (Joseph tells Egypt to save 1/5 for the years of famine).
Basically, do what works for you and your family. Set goals and look at ways to increase savings in the future. Saving is good for you! 🙂
A word of caution though, don’t do what we did when we were first married and set too high a savings budget; if you put in more than you can afford, you’ll only end up taking it out again and feeling demoralised…don’t over-stretch yourself.
I hope that helps you to focus your savings efforts.
Have an awesome weekend.