One thing I realized early on in saving was that I didn’t have to be a tight-ass penny pincher. And trust me I tried to be, at first. There’s a such thing as being frugal and it’s another thing to be a stingy tightwad who won’t even throw in on an Uber or a dinner bill. If you want to be that way okay, stay home and check your bank account every 15 minutes.
For the rest of us, if you want to save for your short term and long term goals all you need to do is stick to the 15% rule. Save 15% of your overall income. That’s it. If you make $10,000 a year you save $1,500, doesn’t sound like much I know. If you make $50,000 you save $7,500 a year, and so on. The money that you save will be divided up among an Emergency Savings Account, Retirement Account (TSP/401k, IRA), and Mutual Funds, which I will get into all of later.
The best means I have seen to successfully save money is what I call Set It and Forget It. The military provides us various ways to automatically save our money, whether it be allotments directly from our paycheck to a savings account, or automatic percentages sent to your TSP.
My first recommendation is start looking at your finances and figure out if it’s possible for you to save 15% of each of your paychecks. If it’s not possible for you to do that yet, start looking at some of the places your money is going that you can cut back on. For example, everyday Starbucks trips, raiding the Gee Dunk 6 times a day, Smoking and Dipping, or going out to dinner more than maybe you should. These are the types of things that will chip away from the money you can save. YOU ALREADY PROBABLY KNOW THIS. But if you want to save more money you should take a hard look at these things and consider if it’s worth it.
-Matthew Bunting (Bunts)
Up next, Emergency Savings and Debt…