When You’re Tired Of Being Broke, You’ll Start Saving

If you were to ask people why they do not have any savings, you would likely here a multitude of excuses. You say reasons, I say excuses, and here’s why. If saving money was important to you, and not just a feel good line to help cover up your lack of priorities, you could save an emergency fund! Sure there might be things that pop up and make it harder, but those things happen to everybody.

In Financial Peace University, Dave Ramsey uses an example to support the idea that if saving money was an emotional priority, you would in fact be able to save some. If you were told that one of your children was going to die in 6 months, that would be horrible. Suppose you were told that you could save your child if you saved $5,000. You would certainly be able to make that happen, would you not?

Saving money would have then become an emotional priority in your life right? That’s the key.

It has to be important to you! It has to be more important than that brand new car! It has to be more important than that expensive vacation! It has to be more important than a $1,000 wardrobe! It has to be more important than ALL OF YOUR WANTS!! Saving money has to become MORE IMPORTANT than spending it!!

Maybe saving money by itself, is not more important than saving your child, but it should be right up there with your basic priorities in life. Think about it like this. What if having an emergency fund in place kept you from having to experience that 6 months of panic to try and save your child? What if you could just hand over that $5,000 on the spot? Then perhaps you could spend that 6 months being their for your child, helping them get well, instead of running around at the last minute because you weren’t prepared for life.

That example may seem too extreme, but there’s a reason Dave Ramsey uses it. It’s because he knows that you love your child enough to make it happen. He knows that if saving money was truly important to you, you could do it. He knows that you do not have any money in savings right now, because it is not important to you. He also knows that it should be important to you!

Being prepared for life is the only way you will ever be prepared for life, so it should be a priority. Make sense?

Want proof? I lived most of my adult life without an emergency fund. I used most, if not all of the many excuses given for not having an emergency fund.

  • I’ll save when I get a raise. (No you won’t)
  • I’ll save when I pay my car off. (No you won’t)
  • I’ll save when I get my tax return. (No you won’t)
  • I’ll save tomorrow, today I am too busy living. (No you won’t)
  • I’ll save when my kids move out. (No you won’t)
  • I’ll save when I win the lottery. (No you won’t)
  • I’ll save after I help my family. (No you won’t)

I no longer say those things and guess what? I have an emergency fund! In a little over two years I went from NEVER having an emergency fund EVER, to having one with $6,000 in it. Do you know how good it feels to have $6,000 in the bank in case an emergency happens? Refreshing! Absolutely wonderful! It is absolutely everything that you don’t think it will be, until you start saving it.

Stop lying to yourself! I did, and now I have an emergency fund in place, but it didn’t happen until I was sick and tired of being broke! Are you sick and tired of being broke? If so, then you are in a better position to make it happen. Where there is a will, there is a way, you just have to find it. If you truly want to, you will.

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35 Responses to “When You’re Tired Of Being Broke, You’ll Start Saving”

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  1. I always connect money in the bank with sleep! The more of it you have, the better you sleep at night. The better you sleep, the more you can produce in your work. The more productive you are at work, the more money you make. The more money you make, the more you have to save. At that point you're on a Winners Roll and nohting can stop you.

    Money is never just about money!

    • Brad Chaffee says:

      That is great Kevin! Oh so true too! πŸ™‚ Thanks for sharing!

    • ffff says:

      some people don’t have credit cards, the only bills they have are rent, utility,food, car payment, and insurance. when you pay your basics, still don’t have money to eat, and cant even afford to move to a place smaller. your stuck, and that is just the facts. there is nothing to save cause you are basically running to pawn shops when you get a flat tire.

  2. The same can be said for giving to your local church or what have you. There's all kinds of excuses and procrastinating, but once you just start doing it you're amazed at how you didn't run out of money and you paid all your bills and you even saved some.

    Just do it!

    • Brad Chaffee says:

      "Just do it" Best Nike slogan ever if applied to our lives in the right way, and for the right reasons. you are exactly right. Once you start doing it, it no longer feels impossible…well, because it's not. πŸ™‚

  3. Abigail says:

    Sorry, but I call bull. Some of us don't save because we're doing all we can to pay down debt. Some people have no debt but can barely make ends meet.

    Yes, I agree that saving is good and should be a priority… if you can afford it. Many of us can't. Tim and I have our credit cards in a pinch — and it makes more sense to pay down credit cards than to stick money away in a savings account that earns 1-2 percent interest. The only concession I've made is putting $100 a month in an IRA. It's microscopic but it's the best we can do right now.

    • Ronnie says:

      Barely making ends meet and not making ends meet are two different things. If you're putting $100/month in an IRA, can you put in $50? I know some places have a $100 minimum, but I also know T. Rowe Price doesn't–my Roth IRA's there. Then you could put $50 into an emergency fund. Many people WON'T, period. If when you sign up, you set up 10% of your net to go into a different account, you'll never have known the difference. If you were forced to take a pay cut or lose your job, most people would take the pay cut and find another way to make do, especially in this economy. When you're sick and tired of being sick and tired, only then will you make a change.

      • Abigail says:

        I didn't say we're barely making ends meet. I was saying that some people can barely make ends meet. We have to live carefully in order to pay down — which we accrued mainly because of health problems.

        Yes, we could put $50 a month into an emergency fund. But there is no point. It will make almost no money. Since I'm on disability, we'll always be able to pay rent with that. If my husband loses his unemployment in May, he'll keep looking for work. Meanwhile, why take away from long-term goals like retirement (we're 31 and only just getting started) which will also necessarily see a better return than a savings account.

        We're already sick and tired of being sick and tired. Literally. I have chronic fatigue and a poor immune system. My husband has conditions that kept him from working for quite awhile.

        And I have to say that, when you're making $3,200 a month, $320 a month going to savings WOULD be noticed. Big time!

        • Mittens219 says:

          How about not even $3200 a month? What if your pay check is less than what you owe? I’m in such a financial noose and I don’t know how to get out! I work as an interpreter for a school district, I make $2000 in a GOOD month. When school has 2 weeks off in dec, that check is $900 if I’m lucky. My 1 bdrm apt for our 3 person family costs $765 (including water). We get minimal help from government assistance programs because I make just a tad too much. My baby is in cloth diapers, we don’t have cable or Internet, my car is barely holding together because I can’t afford to get new parts for it, and if I don’t pay my student loans (that I can’t defer because my ex’s rich family co-signed and they can’t qualify) then my paycheck could stand to get garnished anyway!!! Please, feel free to attempt to fix THAT ball of wax.

          • Don says:

            My question always remains the same: Why do people that have NOTHING have kids?
            Overpopulation results in high consumer demand in EVERYTHING, leaving MANY with NOTHING.

    • Brad Chaffee says:

      Dear Abigail, we always go through this. πŸ™‚ There are always exceptions to the rule and I understand that some people do not fit this profile. Just because it doesn't apply to everyone doesn't mean it is bull. The fact is that America has a negative savings rate, or did, before the economic collapse. Most people have car payments. Most people have payments of every variety. They have lots of excuses as to why they can't save. What they don't have is savings.

      If that is not you then this post is not directed at you, but I must say don't be fooled or misguided in your observation. There is ALMOST ALWAYS something else that can be done to improve one's situation. To just simply stop trying because of circumstances is selling yourself short. (not you) If someone doesn't make enough money, they need a new job. If they don't have training then they need to get some. It may not happen instantly but it can be done.

      I must also say, you are paying down your debt and that is great, but if you have no savings at all then you may want to get some first, and then pay off your debt. You are working against yourself.

      You say you have your credit cards for "in a pinch". Why not have a savings account for in a pinch and ditch the cards. Credit cards are not meant to be used for emergencies, or at least they shouldn't be. You are defeating the purpose of paying down your debt by using your credit cards to cover emergencies. What if you have an emergency that can't be paid off in one month? Then you are going backwards instead of forward.

      I think you completely missed the point of this post. People have stuff, but no savings. People have debt, but no savings. People have fun, but no savings. people have the wrong priorities, but no savings. Those are the people that this post is directed at, not the very very very small minority that are truly doing all they can. Most people can do more but choose not to.

      I am living proof that this post is absolutely TRUE and not bull like you claim. Furthermore, I would be willing to bet that 7 out of 10 people fit this profile EXACTLY!! With that said I stick to my post, but do concede as always, that it doesn't apply to a super small minority of people.

      I have led 3 FPU workshops and have counseled many others, and I can tell you that most of them gave a bunch of CRAP excuses as to why they couldn't do this or that, only to later find out they were full of it.

      • Abigail says:

        Sorry, I'm horribly sleep-deprived. When I said Bull, I wasn't referring to the whole post. As you say, I was referring simply to the fact that this doesn't apply to plenty of people. Next time I read, I'll try not to assume you're talking about all people. But sometimes it certainly sounds like it.

        As for getting a new job, frankly Tim and I would be thrilled to work even one job. But you're right: most people have more options than they're letting on.

        As for my lack of savings, it actually is the best method given our situation. As I said to the other commentator, we have my disability which covers rent. If that is the only income, we'll qualify for food stamps.

        But if you put money in a savings account with a 1-2 percent savings and have credit card debt of 12-18 percent… You're cheating yourself! Especially now that double-cycle billing is gone, there's no real incentive, not when you know you can pay your bills no matter what.

        I understand some people needing an EF. But when you look at the situation, it makes more sense to get rid of as much debt as possible. Even if you put money back on the card (which is done only in the face of a serious unexpected expense) you're still carrying less of a balance.

        As each card is paid off, we're careful to pay it off each month on the occasions that we have to charge something. Once we've paid down the last card, one of my primary goals WILL be to start up an emergency fund. Until then, it doesn't make much sense. Instead, we throw everything we can at debt.

        Although I don't think I'm in quite as small a minority than you think. That's neither here nor there.

        I also think that some decisions that you call bull are arguable. A lot of people do rationalize, it's true. But someone could look at my life and say, "Well, you should just cook more." Which is absolutely true — just not possible on a long-term level. Beyond chronic fatigue, I have depression that can cripple my best intentions. It's not (I finally realize) a matter of will — but someone may not be able to understand that from the outside.

        That said, most Americans got into debt from rationalizing unnecessary stuff. And they'll rationalize a slower way out.

        This is all so nebulous. I'll try harder to remember the implicit "mostly" in your posts. It just gets tiresome sometimes, reading all these post that come down like proclamations that we're in this because of our own actions, that we're all in denial about what other stuff we can do. I get rankled.

        I'm off to take a nap and perhaps I'll be markedly less surly next time I comment!

        For some people, they can't do that, so an EF is the best idea. Otherwise, though, you are putting away money that could be lowering the amount of interest you accrue. It doesn't make mathematical sense.

        If we put down

        • Brad Chaffee says:

          Thanks for the clarification Abigail. As someone who suffers from a lack of sleep most of the time I know how you feel. haha!

          I have to ask you this though.

          If you have an emergency and have to put whatever that emergency costs on your credit card, and the cost is more than you are able to handle for the month to avoid paying interest, how is that more beneficial?

          If anything you are setting yourself up for heartache, struggle, and a potential crisis. In your situation it would seem to me that you would be better off by having as much as you can in savings to cover anything thrown your way. your situation makes you more fragile to what life brings.

          I admit that your debt should be paid off, but you need an emergency fund to cushion the blows that life throws while you do so. I also wouldn't be putting anything into retirement funding until I had no debt, and a fully funded emergency fund.

          They call it personal finance for a reason but what I wouldn't give to have a one on one encounter with your debt.

          I would ask questions like:
          Are you paying extra on all your debt, or are you focusing on one at a time, while paying the minimums on the rest?
          Have you heard of the debt snowball method?

          I'm just curious.

          Oh and one other thing about your comment reminded me of why I hate government intervention. Not that I don't think there are people that need it, but all government programs tend to be based on numbers instead of real life details. If you can't get a job because if you do you won't receive food stamps, the system is broken. Not sure if that's how I was supposed to read that but that's what it looked like to me. The food stamps should be a supplement to get you on your feet financially, not a rusty anchor designed to keep you from standing up fully.

          • Abigail says:

            No you misread my comments about "government intervention" as you call it. I was saying that, if Tim still couldn't find work and I lost my contract work, we could apply for food stamps. We would never avoid getting a job just to stay on food stamps. Almost no one would do that. Why? Because you can only earn about $1100-1400 for a couple in most states to stay on food stamps. It's like people who talk about those who leech off disability. I'm sure it happens, but most people would rather work. Trying to live — let alone live it up — on government handouts is beyond horrible.

            Of course I've heard of the debt snowball method. I'm plenty well versed in PF, even if I don't subscribe to your preferred methods of debt repayment. Here's an article from Liz Weston — the web's most-read PF writer — that talks about not deferring debt overly in order to build an emergency fund: http://articles.moneycentral.msn.com/Banking/Cred

            And I'm still perplexed by your logic, Brad.

            Okay, in your situation, we have $0 in savings and a credit interest rate of, say, 12% (for mathematical ease). Now, a cost comes along that we can't just pay out of pocket. Let's say it's $1,000. We put the amount on the card.

            Next month, we pay it off using our own income. This lessens our debt reduction by $1,000 that month. But in the meantime, that other $1,000 that might have been in an EF has actually gone to paying down debt (and therefore interest) over time.

            Essentially, I could sock the money away for a "what if" scenario in a bank, then pull it out when it's time. Meanwhile, that money is just sitting in an account, not going against my credit card balance. That means not only is it not helping cut down on the interest we pay, it's also keeping our balance higher than it needs to be, which is hard on the psyche.

            Taken my way, I pay down everything I can. If new costs come that we can't pay off with our checking account, we can put them on the card. (We're getting paid weekly at this point, so new balances spend less than a week on the card, generally.) Even assuming it took us a few weeks to pay off the new charge, we've still kept our balance lower over time by putting money on the card and not stashing it away in an account where we may or may not need it.

            I really and truly fail to see how we're any less "fragile" as you put it doing things this way versus your way. Under your method we're keeping money away from debt reduction for something that MIGHT happen. At some unknown future point. Under my method, the money is put to immediate good use, but we don't have a "cushion" to fall back on. Except that, once again, that cushion is really just money that could be going to debt.

            I'm not sure you'll see the distinction, but I guess my point is that there isn't a huge one. My way, you save interest and get to see the balance go down more quickly. (And when you have low income, that can really keep you going.) Your way, you — not me, but plenty of people — feel safer having money in the bank that you can draw on. That can help some people sleep better at night.

            But in the end, what's the difference exactly? Both ways, people can pay for things in a pinch.

            You have this belief that putting, say, $500 back on the card is more detrimental to debt-reduction efforts than keeping, say, $2,000 off the card to sit in an account until, one day, I need to access $500 of it. How long will that money sit there, earning practically no interest, while the credit card interest keeps piling up? That seems like the illogical thing, to me!

            As for your questions about our debt, we owe about $1,500 on one card which has 15% interest. We secured the majority of our debt on a card thanks to a special offer that included 4% for the life of the debt.

            We pay slightly more than the minimum on the 4% card — maybe an extra $10 just so I feel vaguely productive — and throw the rest of the money at the main card.

          • Brad Chaffee says:

            Point taken on the Government intervention although I think you underestimate most people who use it. The system is set up to keep people on it not help people get off of it. Perhaps that is something we could argue about another time.

            On this blog I show people how to use Dave Ramsey's Baby steps to get out of debt which is exactly what I used to comment earlier. Sure there are lots of different ways to pay off debt. Some freak out about which debt has the highest interest and what not but I do not find that important at all. I have friends doing it that way and they are still in debt. they go back and forth about how they just can't seem to make any progress and it feels like they are spinning tires.

            Dave Ramsey's method which has been proven to work hundreds of thousands of times allows you to focus on one step at a time. I have learned that math doesn't matter all that much when someone is trying to get out of debt. I personally think you have make it too complicated for yourself, but that's just my opinion.

            Save $1,000-$2,000.
            Pay off debt using the debt snowball (listing debts in order from smallest to largest).
            Save 3/6 months of expenses.
            Save for retirement.

            That's the method that I recommend to everyone because I know for a fact that it works. While we paid off all of our debt except for our house, some of my friends have made very little progress. That's because getting out of debt is not about math as much as it is about intensity, focus and simply staying motivated by taking a small bite out of it at a time.

            You are sure welcome to use your credit cards as an emergency fund if you so choose, but I find great comfort and peace of mind with our emergency fund and have since day one, even when it was only $2,000. I was only making suggestions because you seemed to be suggesting that you were having a hard time. Maybe I misread what you wrote though, it's been known to happen. πŸ™‚

            No matter what method you use to get out of debt I commend you either way. Here on Enemy of Debt though, I talk about the method that worked so well for us and many others every single time and fast. I don't expect everyone to follow that plan but it is an awesome plan. To each is own.

            For fun, you may want to pick up The Total Money Makeover to see what all the fuss is about. For the record I do not like Suze Orman at all but in that article she is quoted as suggesting that you only pay minimums so you can save a big nest egg. I, nor Dave Ramsey suggest that. with Dave Ramsey's plan you are only saving up $1,000, then paying the minimum on all but the smallest debt on your list, but you are doing so, so you can focus on one at a time and knock it out faster. Each time you pay one off you get motivation from it and that is very important. AFTER you have no more debt you work on your large emergency fund.

            I don't expect to convince everyone of this, but doing math when getting out of debt complicates things to a different degree. getting out of debt is already overwhelming, and this is why Dave Ramsey's plan works for SO MANY people. I got a headache just from trying to keep up with all of your numbers crunching. πŸ™‚

            Anyway, good luck Abigail. πŸ˜€

          • Abigail says:

            Once we're clear of the credit card debt — which is hopefully in June — we will start building an emergency fund so that we don't have to keep putting money on the card. That will be my main effort, once we're no longer paying significant amounts of interest on the cards. We'll also have Tim's last student loan ($3,000) to finish paying off, but that can be knocked out relatively quickly.

            As for your comment that retirement should be put off until CC debt is paid off and an emergency fund is fully funded… You're talking about sacrificing at least a couple of years of compound interest — which is where retirement gets so much of its punch. An EF — assuming that would still be a 6-month deal — would need $9,000, minimum. That's about 3 months of our total income! So if I'm trying to pay down debt and build an EF, that would take an extra 18 *months* just to build up that EF at $500 a month. Which is unrealistic while we have credit card debt anyway! So you add in paying off the credit card debt AND building up a six-month EF, and you're looking at delaying my retirement funds by 2-3 years.

            Oh, and assuming the amount we get hit with is several thousand, given our limited income, what are the chances we'd have it in an EF yet anyway? We might have it, but, again, that's $3000-5000 that could have gone to credit card debt. Which would be 1/3-1/2 of what we owe total. Again, if you strip away the immediate, knee-jerk belief that you NEED an emergency fund at all time, why is keeping that much money in abeyance "just in case."

      • Jaki "B" says:

        Brad, I agree 100% with your post. It definitely applies to me and it’s time I fess up and realize it. I’m currently unemployed (collecting unemployment). My thought process has always been to try and pay off my bills whether or not it leaves me with anything to save. This so-called thought process has left me in a pinch a many of days … I’m never prepared for the curve balls of life and I pay the price for it. It’s a painful price to pay. Continuously worrying about money (or lack of money) has been the demon on my back for years now. I’m stressed out all the time and getting deeper and deeper into financial holes. Just a couple of days ago I promised myself that I would save something out of every unemployment check – be it $25 or more. Come hell or high water I need to be consistent and make this a priority. No sense in expecting more when you can’t be smart with what you currently have. Keep a “sister” in prayer (lol)

      • Mittens219 says:

        I see your point entirely. Like you said, I got rid of my credit cards, I paid off the car loan and vowed to never do that again! So what do people do when, they’ve borrowed to get the training, and then have to pay back on loans, and to get further training, means borrowing more to get the better paying work…. Etc etc. where do you begin, when you’re already so far behind and going backward like you say? When I don’t make enough to pay all my bills every month and constantly trying to play the catch up game, what do you do?

        • Brad Chaffee says:

          It sounds like to me that you are doing all the right things Mittens. However, it doesn’t sound like you have a savings problem as much as you have an income problem. Fortunately for you there are many ways to earn extra money in order to increase your income.

          We are struggling a bit now in the savings department. In the last year our expenses have gone up (weight loss program, private school, increased medical bills, etc) while our income has dropped by more than $1,000 a month since January. (We voluntarily reduced our income so my wife could be home more and we could live the life we want, but we didn’t anticipate some of the increased expenses for the second half of the year) We’ve been living off of about $2,000 a month with my wife working part time as a nurse. We quickly drained our emergency savings over the summer and now we have two choices. We can either continue to struggle and not replenish our emergency fund as fast as we need to or we can look for ways to earn a few bucks to increase our income.

          Here’s what we’ve decided to do.

          My wife has decided to go back to full time as a nurse and I’m working on getting a part time job with a local college cab service that transports students around the campus as well as anywhere else they need to go. My wife also sells on eBay and plans to start getting serious about that again especially since this is the best time to do so (around Christmas time) Last year we made $4,000 in November and December combined doing that.

          On top of that we are both Certified Health Coaches and get paid to coach people to health. That job is what we both want to do full time eventually so we’ll both be working from home but for now we have to build up our clientele. Then I have my blogging and writing side ventures that can bring in a little more as I build them like I did with Enemy of Debt.

          And something we just recently decided to do is collect golf balls from local golf courses, clean them up and sell them by the dozen on ebay. (We found over 100 golf balls in just three holes at the golf course) Golf balls are expensive so we’ll be able to seel them at a HUGE discount and save golfers tons of money. It’s a win-win for everyone involved. πŸ˜€ Me and my 2 boys help me with that so they will earn some of that money too but that’s just an example of how we are not accepting our circumstances the way they are. We are constantly looking for ways to increase our income so we can reach our financial goals.

          It all depends on how bad you want to change your outcome. It sounds like you want to really bad so now you just have to get a little creative and find something that works for you. πŸ˜€

          Hope this helps. πŸ™‚

  4. Yana says:

    Some people don’t want to save. Sometimes their reasons actually are reasons, to them. Answering the questions, why are you working and what are you working for?, can reveal the person’s attitude toward money. There are people who work because they want to spend money. That is what it’s for, they might tell you. To me, money is to *have*, because it will get squeezed out of you by force – and the squeeze is even more painful if you don’t have the money in a critical situation. Recently I had just talked to my girl friend, who is my opposite as far as attitude toward money. She and her husband have “extra” money taken out of their paychecks because they can’t handle money. Those last words are mine, not theirs. I mean at least $6,000 a year tax refund. She told me that day that it’s their “savings”. Later on I was chatting with the grocery clerk about how thrilled I was to have gotten my taxes done for free this year, instead of paying H&R Block $200. He told me that he and his wife were considering abandoning H&R Block as well, but also mentioned that their refund was their savings! Hard as I tried this year to not get a refund, I still ended up with just over $300 coming back – because of credits I didn’t expect. It’s fine, I’m happy about it – but it’s not my savings! LOL

    But for all our efforts, I can’t help but wonder if those other folks might fare as well or better in the end. Many people are like that, and many people have always been like that in the past – yet they have still lived to old age without being homeless. Maybe what I’m thinking is that I am in complete agreement that money attitudes are based on what matters to a person and how they value everything. And that should be enough, even if it turns out that it wasn’t for any purpose other than expressing one’s own personality.

    I have zero trust in “guaranteed” pensions or work-related retirement, but that is what my friend and her husband are counting on. They think they’ll be fine with that kind of income, and they believe it is an absolute. When I tell her I have no trust in that kind of thing, she says she’d be mighty furious if what she worked for all her life was not provided to her. But in the meantime, she isn’t reconsidering her faith.

  5. Jan B says:

    I was always afraid to save. I had been told since I was a kid that I could not save anything and I proved that as an adult. When I started with Dave Ramsey's plan, I started paying off debt until some of the folks on the site told me to stop and go back and start my baby emergency fund.

    I was thunderstruck and I didn't wanna do it. I wanted to keep on paying on debt. But I stopped and finished up that baby emergency fund in a month or so.

    I have put that into a savings account with no checks, no debit card, no way for me to get to it other than to physically walk into the bank. I like that.

    And it's there for us. I love that. I just got laid off last week and now I am putting a bit more in it just to be sure that we will be ok until I get another job. Saving is not just something people should think about, it's essential to financial peace.

    My emergency fund is the replacement for having to charge on a credit card if we (when we) have an unexpected emergency.

  6. Everyone will have an "enough is enough" moment before they decide to make a change. For some, that may be the embarrassment of having their debit/credit card declined, for others it may be losing their job and barely making ends meet, others may lose their homes, see someone else go through financial turmoil, have a lifestyle change like a newborn…whatever it is….it isn't until "enough is enough" that change will happen.

    To Abigail ~ technically you are saving with the IRA so even though its not the type of liquid savings discussed, your situation doesn't appear to be targeted by this post.

    I hope it motivates someone to say "enough is enough" and start saving today!

  7. Donna says:

    I have to say truthfully that the idea there is no use in having money in the bank because it doesn't earn anything is the wrong attitude. The few dollars we have in our EF is vital for us. It keeps us from using our credit cards for those things life throws at us. It helps us sleep at night. It gives us the confidence to keep on moving forward, even in the face of my current disability situation and our uncertain financial future. I don't want to be a slave to anyone or anything except the Lord. I understand there are people who truly don't have any choices given what life has dealt them, however, it is important to start somewhere, somehow. I too am struggling with money choices, but I will not give up my EF even if it earns nothing. Thanks Brad for a great post.

  8. Yana says:

    Donna, I agree. That could make an excuse for people who don’t want to save. Savings will grow because you add to them. Earning interest is a bonus, but I think it’s much more profitable over time to never pay interest than to earn it. Which goes with spending less over a lifetime – much less.

  9. Ken says:

    You are so right. It comes down to desire. Period.

  10. Monevator says:

    I think one problem here is that it's so painful admitting you've got a lot of debt that it's easier to make an excuse than to confront it. And obviously, without seeing the clear goal, it's very difficult to work up a desire towards it. This may sound like I'm stating the obvious, but people can fool themselves in all sorts of ways.

    In short, to desire to be free of debt, you have to admit you hate your debt so much you have trouble admitting you hate it!

    Good luck debt busters, it's a simpler life without it.

  11. Dave says:

    Brad, there's a powerful message here. Saving money has to be more important that a car or wardrobe. That is a powerful statement AND an easy one to simply read through.

    It HAS to be more important. It is not an option or decision point. It HAS to be.

    For me that invokes an image of an old timey blacksmith pounding and forging metals. It is not easy but the end product is a tool that is both better and stronger.

    Our approach to money is similar. Planning for our future HAS to happen a fancy car does not.

    A great an important message here!

  12. David Damron says:

    Sadly, you are exactly correct about all of this. It wasn't until I was tired of being paycheck to paycheck that I decided to start saving.

    Great points made as always Brad

    The Minimalist Path & LifeExcursion

  13. Forest says:

    Emotionally my debt has been in my face for a long time so I never saw any positive numbers anywhere…. Now it's all tucked away in Debt Management with one monthly payment…. That means my new checking account says + and not -…. This has given me the push to start the emergency fund. I am only getting about $160 into it this month but if I can double that next month and a few months after I should have a solid ground…. then it's off to tackle savings and a travel fund.

    I have not read any of Ramsey's stuff but am thinking about picking some up or just reading his site for a while.

  14. Brian says:

    To me, and emergency fund is an incredibly calming thing to have. If you can only afford to pinch together $100 in your EF, then it will just make you sigh a little less. I know the more I have put away, no matter how hard it was to put it away, it's made me feel more comfortable the higher the fund has gotten. And that's regardless of the interest it earns; that I really don't care about.

  15. Retro_Housewife says:

    Hi Brad,
    just wanted to say that I loved your post! My partner and I made excuses for nearly a decade of why we couldn't save. It was only after we buckled down, cut up the cards, stopped coming up with excuses, and made an effort to save that we were able to start putting cash away in a savings account.

    It turned into a serious challenge (yeah, we're both a bit competitive!:-), and we wound up with just over $5000 in the account at the 1 year mark. It was a bit of effort, but so worth it…especially when we had an unexpected (and expensive) bill pop up a few months ago. Anyway, thanks for the "just do it!" style advice!

  16. Just Hanging In There says:

    I wish saving money were so easy. I live in Michigan and the economy here is so bad I haven’t seen a raise in 7 years now. In fact, I’m losing income because I now have to pay $300 per month for my health insurance because Blue Cross keeps raising our rates. We don’t live beyond our means, pay cash for everything and the only bills we have are mortgage, gas, electric, cell phone, insurance, cable and food. We paid cash for our vehicles so we have no car payments. Our only splurge is $9.99 monthly for Netflix. Seriously, that’s it. We still have dental and medical bills because even though my insurance premiums are $14,000 annually, almost nothing is covered! (Yes, my health care premium is almost as much as my mortgage!) My husband recently had an MRI and it cost us $1500! How are we supposed to save when there is never anything left after spending every dime just to survive? We have zero debt and can hardly make it and our household income in in the top 30%. I honestly wonder how other people are doing it.

    • Brad Chaffee says:

      Well I definitely understand your position is working against you more than it is working for you. Situations like yours call for tougher solutions—solutions that you may not like, but are available. I am certainly not in your situation, but if I was I would handle it in two ways. I would get a second job, because saving is THAT important, or I would get the heck out of Michigan. Michigan has one of the worst economies in the country. It would be a difficult thing to do in the short term but in the long term you would probably benefit greatly. I for one, LOVE, LOVE, LOVE Upper Michigan but there just isn’t anything there job wise to get me to move there. I know some people living in Michigan that are killing it on their Total Money Makeovers and both work two jobs to pay off debt and save more money. DeliverAwayDebt.com and DivineAndDebtFree.com. It may suck but the bottom line is this; if you can’t make it on what you’re making you have to do more, or you have to do something different, and in some cases you have to do both.

      I know if it sucked to live in VA (thankfully it rocks because the state is well run), I would move in a heartbeat if it meant I would have better opportunities to strengthen my situation, whether it be financial or otherwise.

  17. Jim says:

    See… I have this other issue none of you seem to be in the least concerned about. I’m too much of a giving person to be able to save.

    I’ve tried saving. My son’s car had an issue, so I fixed t it. Then I find out my brother’s house is almost in foreclosure so I gave them the money to catch up. Had I just paid on my credit cards or even bought a few of the things I WANT, I wouldn’t have had the money to give my brother or my son would have had to walk to work for a couple weeks. Family is one thing I just can’t turn down. So all in all I am right back at square one with the same debt I had before I really tried to save. Yes, maybe my brother still has his house, but had I not bailed him out does he really deserve it anyway?

    My point is, some people are savers, yes… And I definately admire that. But some people feel if the world ends tomorrow, why worry about how much you have in the bank rather than the joy you could have had spending it? So long as you make enough to pay your bills, what’s the deal?

    • Brad Chaffee says:

      Jim, With all due respect, giving is one thing but causing yourself to be less prepared for what life throws at you is more important. It’s not selfish to make sure your own financial situation is in order before you start helping others. I wrote this post that I think you will find helpful.

      Now I have to take issue with your logic in the final paragraph. “But some people feel if the world ends tomorrow, why worry about how much you have in the bank rather than the joy you could have had spending it? So long as you make enough to pay your bills, what’s the deal?”

      The deal is that you are leaving yourself vulnerable to emergencies that may come your way. If you have an emergency, the people you are helping, are not in a position to return the favor to you so you will only worsen your situation. To use “if the world ends tomorrow” as a reason to not save but instead make your own financial security worse, is the wrong way to look at it. The right WHAT IF would be what if you have an emergency that you aren’t able to cover? What are you gonna do? The answer: you are either going to become a burden on someone else when you could have planned for, OR you will have to go into debt, which is never a good idea.

      My question to you would be this. Why would you knowingly ignore the importance of preparing for your future? It could also be said that you aren’t really helping anyone if you throw money at them every time they need it. You could be enabling them which means that they will never learn how to handle it themselves, and will probably be back to get more funds from you down the road.

      Lastly, I am a generous giver and I can say without a doubt that we are in a much better position to give without causing ourselves any financial distress than ever before. I hope you check out my post: Great Financial Advice From The In-Flight Safety Handbook

      I hope you consider an alternative to your current plan. Wouldn’t it be better to have your cake and eat it too? You can save money and help your family but you will need to do things a bit differently to reach that point. Either way I wish you much luck, and I will say I am glad to hear you have such a giving heart. We need more people like you out in this world. πŸ˜€

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