Saving for what’s next
November 30, 2008
This is Part 2 of a three-part series, Navigating the Financiapocoalypse. It’s intended as a get-started guide for people just starting down the path of actively managing their money.
Even more important than how you’re spending your money this week or this month is what you’re doing with what’s left over. Americans are saving less than ever before, at a time when health care costs are rising and retirement plans (and the chances that Social Security will exist in 35 years) are dwindling. You do not want to get caught with your pants down later in life — start saving now. Save early, save often. In an economy like this, though, forcing yourself to save can be tough.
Set a goal
As I said in part 1, I don’t track every dollar of my monthly expenses. I do, however, kind of have a reverse budget — I don’t map out my monthly expenses, but I do keep an eye on my savings percentage. I set a goal — say, I want to save at least 30% of my take-home pay every month — and if I’m not meeting that goal, or not able to meet it comfortably, then I know I need to go back and re-examine my “right now” expenditures. Once you have a number to shoot for, you have to set some things in motion to achieve it.
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