Sunday, October 11, 2015

Mind Trickery to Boost Savings


I like to feel like I have a healthy relationship with money. I'm not a spend thrift, but I also don't agonize over every purchase, though I have had enough times in my life that out of necessity I counted up the price of every item in the grocery basket to the penny to make sure I had enough. Still, I am trying to cut out purchases that are neither necessary or enjoyable in order to channel more money towards things that are both. I often feel though like I am not seeing the results of these efforts. This is partially because DH's salary fluctuates plus he gets off paycheck bonus payments, so when there is more in the checkbook, it isn't necessarily from careful shopping. When we paid off the Equinox three years ago, we continued to make payments, but this time, to ourselves. We even pay it to the account we use to make a monthly deposit to cover the once a year  housing insurance and twice yearly tax payments. This way we can see what that little nest egg is doing, but we don't think about it as part of our regular household funds to access. I want to do the same with the random household and daily "life" savings I am able to set aside. 

In an awake at 4:00 think, I started looking at how easy it really would be to knock off on average $100 a month from cash flow without changing anything in our life. This would be those little savings, dollars and cents off the budget, derived from taking the extra few moments to find a better deal, or decline a purchase, or any rebates or extra earnings. I'd like to see what that will look like over time, separated from the regular household accounts. For example, I needed a new pair of black flats and a pair of canvas deck shoes, staples for my footwear and long overdue. While I had budget to spend up to $60 on the pairs, I found several that would work, choosing the lower cost versions, perfectly functional for my needs, $40 for both. This is $20 of the cash flow that could now go into that account as opposed to just being in the regular checkbook,  a recipe in my house I fear for easy justification for an unplanned purchase.

We have not been happy with one of our banks, particularly less so after said bank was incredibly difficult for my mother-in- law to deal with since her husband passed away.  The bank has become too big with too many rules that improperly trained staff didn't understand, and no personal touch until she got so fed up she decided to close all her accounts and move. (That got their attention-too late.). The other bank is small town, and comfortable, but I don't want easy access to the funds. I also would like to see if I could get a little bit of interest on these funds seeing how they will not be touched until we decide they fit a priority.  I've not used the world of virtual banking before. While I transfer funds and make direct deposits on-line, our banks still have bricks and mortar in our community, and basically no interest earned on the accounts.

I looked on line and found the following list of the best savings rates for 2015. Savings Account 2015   I was a bit impressed with GE Capital Bank's on-line savings calculator.  If I start with just $300 in an account, a sum I think I have saved over the course of the last three months via careful shopping, and commit to monthly deposits of just $100 per month, by the time DD#2 is in her freshman year of college, we will have $5,113.  The dollars would just be sitting there, ready for any unexpected needs beyond what we are saving for her schooling-pain free. $113 of that is interest, and while not a fortune, it is 10X's more than either current bank.  Maybe it doesn't make a difference which account  the money grows, but when coupled with  our regular savings and checking, I think we easily could easily just suck that $100 into another expenses.This is a bit of mind trickery at best, but should be a real motivator for sweating the small stuff and seeing tangible results of the savings. 

Now readers, who out there has set up a separate account to help track your thrift driven savings? Is there something special you are saving towards, or like me, are you more wanting to have a way to see the fruits of your thriftiness, while building an extra safety net? Do you have any recommendations for online banks that have helped you achieve your savings goals? 

9 comments:

  1. I have 4 accounts at 360CapitalOne online. One is a checking, one is for the College funds, one is where I put my Yearly Savings Challenge monies and the other is my personal fund, where I put monies like my blogging revenue, a small inheritance I got years ago, some rebate checks, etc. I just like to have that last one as it's "my" money. ;-)

    While the accounts at 360 CapOne don't earn a ton of interest(.75% currently) like stock investments/mutual funds/etc. it DOES earn more than reg. B&M bank accounts-my B&M pay .013% lol(except that checking acct. one), plus it is very liquid should we need it(you just need to have the account linked to your B&M bank account to draw cash out).

    CapOne360 are giving out up to a $500 bonus for opening a new account at the moment(runs til end of Nov. I think) Go here to see what that's about..... https://home.capitalone360.com/lp-savingsbonus500
    I don't get anything for referring you to this.
    I've been with their predecessor since 2007(ING)and since CapOne bought them out in 2012 I haven't had anything bad to say about them either.

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    1. thanks for the tip. I wanted real use referrals, so this will be most helpful. I'll see how to get the bonus-might work since we are leaving long term. I like the "my money". We each have one small account from some family money.

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    2. Ok-Took a quick peek. Minimum deposit for $5,000 for a $50 bonus. I've been saving-but not that much. Better interest rates though.

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  2. You've got it right. it's easy to call a bargain "savings" but if you just spend it you've saved nothing. It's too easy to confuse "getting a bargain" or "getting a good deal" with savings. It's only a saving if you hang on top the money, not if you decided that you can now spend the difference on a coffee and cake!

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    1. So true, and thats what I want to put an end to.

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  3. The most difficult thing about savings is the actual saving part. We have always had it taken out prior to us ever touching it, so there was never a decision or discussion to "wait" just one month in order to get something. It is the idiots no see it no spend it policy, which works well for us idiots.

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    1. I understand. We do that with our retirement-put the max we can away as if it never existed. You have something that works.

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  4. When I went into 'super-save' mode last year I started using cash for all my personal purchases. I also forced myself to write down every penny that I spent so I could identify any spending 'culprits'. (It didn't take me long to realise that I my coffee shop habit was costing too much....). I used my debit card to pay for all the household bills... and was also able to focus on areas where I could make savings. It worked for me because Mark has a regular income too. I imagine that it could be harder with your husbands slightly less regular pay checks. Jx

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    1. I know some who use envelopes and when money is gone there is no borrowing from other envelopes. I know that would not work for us because there are disruptions-good like "stockup sales" or lows like virtually no DH paycheck. Keeping track better would be helpful.

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