When Handy Hubs and I first moved in together, although we pooled everything, our respective incomes had respective jobs. Specifically: (the amount equal to) Hubby’s pay went to rent and student loans while everything else we bought (car insurance, tenant insurance, groceries, entertainment, gas, etc) had to be less than my pay as a teaching assistant. The car payment was made from both our wages, largely from extra money I made tutoring and selling spiders. We tried, but we didn’t really save a lot of money. Every penny had a job and if we were short a penny, we felt it because things we pretty tight (granted, we were doubling up on student loan payments).
As Hubby & I made more money, we were able to start saving more, and breathe a little, but I was worried that we would swallow up the increased pay with luxuries like brand name dish soap. I started shuffling some of my pay cheques into our joint savings account every pay day, before we could even get used to the money in our hands. Eventually, as Hubby’s wage increased, I had my whole pay cheque deposited directly into a savings account that only permits two withdrawals a month (and makes us a little extra interest).
For us, a lot of financial security has come from tricking ourselves, first by boosting our student loan payment right away so we got accustomed to paying a higher amount and kept our spending in check accordingly, then by automatically depositing my pay into our savings so we don’t even think of it as our money to spend. For us, once money is in the “savings” account, we see it differently. It becomes special and untouchable. We only dip in when it’s essential (like when our fridge died peacefully in its sleep) and routinely squirrel the money away into even more untouchable places, like investments.
This is one way we have been able to successfully save and although not everyone can do this, having money automatically moved each month from a chequing account to a savings account definitely helps us safe because it’s automatic and also forces us to live on less.
Ooo, savings posts! I love hearing how other people save. I try to put a few hundred into savings each paycheck, but rainy days find me as fast as I can save. :/
It's so hard when it's accessible, isn't it? Have you thought about opening short-term savings (like a GIC) investments? The money is untouchable, unless there's an emergency. You can then withdraw but lose the interest you've earned. It's more of a hassle to get money out of these. Rules vary and a financial adviser would know best but sometimes it just needs to be out of sight, you know? That's my biggest challenge – just getting the money where I can't (or won't) touch it, lol.
I have an IRA account where my "real" savings are, but I also have a savings account through my bank that takes $1 out of my checking account and transfers it to the savings account every time I use my debit card. That's another way to set aside a little extra money without even trying.
I've heard of those debit cards! It's good to hear it's a successful way to save.
For me, the easiest thing to do is to set up automatic payments for bills as much as possible and I also overpay debt – line of credit, mortgage by as much as possible. When the money is automaticlly "not there" in the spending account, I don't feel its loss.
You're like us then – out of sight, out of mind! We've also been putting extra on our mortgage when we have some money to play with because, really, while the mortgage looms over our head "fun" money could be put to better use. Well, some of it 😉
great post!
great post