To be completely honest, sometimes I feel like “saving” is just cursing me for some sort of calamity. Doesn’t it seem like every time we save up a little money some sort of disaster strikes? This is the point it is best to take a deep breath and remind ourselves “stuff happens” – at least we have a little savings to help.
A few weeks ago, as I happily waited for my tax return to come in, the dishwasher broke and leaked all over the kitchen floor. There went the tax return which I had already earmarked for my emergency fund. Now I need to come up with a new plan.
Searching Pinterest, for some new and fun ways to save, I came across “52 Week Challenge” variations. First thing that jumps to mind is “what a bummer, we are already a few months into the year” – right off the bat this wasn’t what I needed. Well, this is a goal let’s make it S.M.A.R.T, then we can make it ‘fun’. Print out the worksheet to document your SMART goal.
Think about what you are saving for or why you want to save.
- Is this for an emergency fund of 3 months worth of bills and expenses?
- Next summer’s vacation to visit grandma in Ireland for 3 weeks (sounds nice)?
- Christmas shopping in November for the kids, in-laws…?
How much do you really need to save?
- What are your expenses over 3 months?
- How much will this trip cost? Expenses like air, meals, hotel, site-seeing, insurance,…
- What is your Christmas shopping budget? What did you spend last year? Are you going for a lean Christmas?
Generally ‘M’ is for “Measurable”. Money is pretty easy to measure so I think it would be better if we look at making sure you are truly motivated to save. Think about it, are you prepared to sacrifice your take-out coffee and cruller every day to save? Are you secretly sabotaging your trip to Grandma’s because you really just want to stay home and finally clean out that garage?
How motivated are you to save?
A Agreed On
While most people use ‘A’ for “Achievable” when it comes to money, especially money you share with another person, make sure your goals are agreed on. You may be saving money for a powder room makeover but your significant other may think it is time to replace that evil dishwasher before it ruins your beautiful hardwood floor (I digress).
Darn that reality! It is always sneaking in and ruining my goals. Realistically I will not be a millionaire in the next 6 months by socking away $10 per day. Sometimes the math just doesn’t work and you will need to go back and tweak or completely re-evaluate the goal. Let’s not set ourselves up for failure right from the start.
Take a big step back and look at your debt. Would it make more sense to pay down a huge credit card bill (and not continue using it) and save on the extra interest. Saving interest, is saving money!
In most cases ‘T’ is for ‘Time-bound’ which is very true for a savings plan. You need to know how long you have to save. If you are like me with a set of 6 year old twins….I have a good 12 years left to save for their education fund. A trip this summer, that is only a few months away.
I like the idea of ‘T’ also being for “Trackable”, personally it will help me with the ‘motivating’ component. Giving yourself a little check mark whenever you take an action will also keep you focused and on-track.
Time to Save:
Now that we have our Specific/Motivating/Agreed On/Realistic/Time-bound (Trackable) goal it is time to get saving. Look at how much you need to save over given period:
- Are you paid weekly, bi-weekly, monthly?
- How can we divide it up to make it easier on you?
- Should you start with a lump sum?
- Are you saving in a jar or a bank?
- Can you set up automatic transfers to a specific account?
How to Make Saving Fun:
- A visual goal that you can interact with. Feel free to use this template.
- Checks, stars, thermometer accountability
- Rewards (save for 3 weeks, get a coffee)
- Sneaky Savings – Some financial institutes let you roll-up on every debit transaction. That amount is moved to a designated savings account.
- Gift Cards – I wish I could find the post to give credit to the first place I saw this idea. If you are saving for Christmas presents, buy yourself a gift card every pay-day towards your Christmas fund.
- Re-evaluate and re-commit periodically