Saturday, October 2, 2010

Save Money - One Coin at a Time

There are many methods and tips out there to help you save money.  Some advise you to set aside a percent of your earnings.  Others tell you to simply deposit $10 a week into your savings account.  Both methods work, of course, and they are both relatively easy, but I've discovered something better. 

Like most Americans, I live paycheck to paycheck.  I'm 26, and saving for my retirement a million years from now is not going to help me make it through the next year's financial challenges. Personally, living paycheck to paycheck is alright (for now), but it comes with many concerns.  The main concern is the lack of financial flexibility.  Meaning, I can financially make it through the daily maintenance of living, but If something big or unexpected happens, I'm screwed!

If my car breaks down, or my computer gets stolen, I will have no spare cash to cover that expense.  I will be forced to take out a loan, or sell something, or even worse, borrow money from the parents.  My inner future CPA won't allow myself to be put in such a position!

So, how do I save money for unexpected expenses?  One Coin at a Time...

My tried and true method for saving emergency money is simply this:

  1. CASH - You have to use cold hard cash to make this work. 
  2. Whenever you buy something, give the cashier BILLS ONLY to cover the total.  Ex) If the total is $1.25, give her $2.00 in bills. 
  3. When the cashier gives you your change back, SAVE IT!
  4. Save it in a large container with a top that you can not see into.
When that emergency comes around (and you know it will), simply cash in the coins and put it toward your unexpected expense.  

Skeptical?  Last year I alone saved up $127.00 worth of change.  In a larger family of 4, coins will most definitely add up to much more.  

Some efficiency tips are:
  • Take a clean glass salsa container (or anything that will fit in the cup holder of your car) punch a hole in the top large enough for the money to go through.  Keep it stashed in the consoled of your car so you don't end up with coins all over the floor board.  
  • Ladies, whenever you buy something, toss the change in the bottom of your purse.  When you clean out your purse once a month, you will undoubtedly get a giggle from the amount of loose change you've saved in there.   
  • When its time to cash in your coins, don't go to one of those machines that charges you 7 cents per dollar!  Most banks have a machine that won't charge you.  See if your bank has one, if they don't consider opening up an account with a bank that does. 
This method is easy and produces results, not much results, but a little is better than nothing I always say.  Get your kids in on it too, make it a learning experience for them.  Teaching kids about money early in life will instill much needed future responsibility and character. 

Give it a try.  Please tell me what you think! 
Have you tried this technique before?  Did it work?  Let me know!

Good Luck


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