- Personal Finance
Saving Money that You Don't Miss: The Lazy Savings Plan
Lazy Man Savings Plan
Spending is More Fun than Saving
This New Year I started to think about how much money I have earned (and then spent) in the past year. Why isn't any of that money in the bank? How much do I give up to pay rent and go to the movies each year? I don't know the answer to that because, frankly, I am not going to stop going to the movies. And neither are you. Because you and I are lazy savers. It's just easier to spend. And we're busy people, we have movies to see!
The Lazy Savings Plan
If you are familiar with my work (as I am sure you are not) you may have read my other savings account article called How to Save Money and Increase Your Savings Account Balance. All of these are great tips that I have never done for enough time to make a difference. I need an even lazier approach here.
I do not think that being a lazy saver means that you can never have an impressive savings account balance. It simply means you have to find a creative way to save that allows for your laziness. This is what I have set out to do on what I am calling the "Lazy Savings Plan" that I am implementing for the New Year.
Save Just 5% of Your Income
Think for a moment about the percentage of your income that you are currently giving to other people without question. What is your tax rate? Are you really spending 20% of all the money you make on your car payment? Why does your rental agent or the car company get first dibs on that percentage of your check? The more important question is, why don't you have any dibs on a percentage of your income?
No more, I say. If I made $30,000 last year and had saved only 5% of it, I would currently have $1500 in my savings account. WTF? My balance is like $1.37 and that is embarrassing. Especially considering that I had a great year and made much more than this example income. In reality I could probably have the same amount had I saved only 2% of last years income. I may be lazy, but I am not stupid and I am kind of irritated about this.
The good news is that 5% is not very much on a per-paycheck basis. For every $100 I earn, I am simply putting away $5 -- no big deal, right? If I set aside $5 for every hundred it won't hurt at all. With a limited amount of effort I can call the bank and tell them to set aside that stupid $50 or $70 per deposit for me. To be honest, I probably would have spent it on something dumb anyway. If the bank can do this work for me, it only takes me a phone call to set up and next year I should have a nice little lazy savings account balance.
Save the Grocery Store "Savings"
You know all of those dumb cards? You know, those "savings" cards that you get discounts at the supermarket for? I have one for the pharmacy, one for the grocery store and one for everything else, I think. I mostly forget to use all of them except the grocery store savings.
I don't know why I even participate in the pointless "got your card" exercise, it is kind of a pain and it doesn't really save me very much unless I am power shopping for discounted stuff. (And I'm not!) I like my name brands and I'll buy what I like. Just because I want to save doesn't mean I want to eat generic Mac and Cheese. But lazy as I am, and as lazy as I know the majority of people are, I see everyone using these cards.
On my last trip to the grocery store I spent $84 and saved $3.60 - it says so right on my receipt. Big deal, right? In addition to being lazy I am also a bit messy, and there are receipts laying around all over my car, my house, in my purse, you name it. How much would all those receipts "savings" addd up to? I'm not going to collect them and add them up or anything, I'm lazy! But a quick calculation tells me that a similar trip once per week could add up to about $200 per year if I actually saved all of my "savings" from the grocery store.
So, I have set up a bulletin board right next to my front door. Every receipt from the grocery store will go on it and it will not come down and take its rightful place in the trash can until I get on the computer and literally transfer that lame $3-7 in "savings" into my actual savings account. Time for bulletin boarding? Less than the time it takes to put away groceries. Time to add up the savings? No more than the amount of energy I expend paying bills each month. So part of my bill paying is now refunding my grocery savings to myself. IT IS NOW A BILL!
If I wanted to get super weird about this I could do this with more than just the grocery store, I have a card for everything, as I am sure you do. I could take it a step further and start clipping coupons and buying only sale items, too. I'm not going to do that because I am lazy. I'm not going to be extreme couponing and building an add-on pantry to my house in order to store my pallets of discount paper towels. But this is a start. A lazy, lazy start.
Getting Paid to Pay my Bills on Time!
Did I know that my Discover card gives me cash back bonus awards? Absolutely not! Actually I did know this, Discover card sends me emails about it all the time. And I sign up for it and forget about it. Last time I was in my account, however, I noticed I had $60 in rewards. GAME ON, DISCOVER!
Let me explain, because I know everyone says not to use credit cards. However, as a lazy, lazy person I hate paying bills and generally put it off as long as possible. So the I have used the credit card in order to save myself the hassle of late fees. Every bill I have that allows me to pay via recurring credit card payment is automatically charged to my Discover. I don't really use it for anything else. This way, instead of worrying about the due date to the cable company and phone bills, I just worry about that one credit card due date. Along with the rent and car payment, that leaves me only a few consolidated bills to pay each month instead of 17 smaller ones.
I never thought much about the rewards of the Discover card because it was always used to benefit my bill paying. However, now that I know that the money is there and I did nothing to get it, I have a new source of savings! Now all I have to do is make sure I cash in that money to my savings account instead of using it to buy something I don't need with money I didn't know I had.
It is true that I have been using the card for a year and only earned $60, but I had to pay those bills anyway. So it's free money that I earned simply by paying my bills on time. WIN!
The Lazy Savings Method
I am not going to say that this is fool proof because I have not tried it and it's my new experiment. However, if you have anything to add to the Lazy Man Savings Plan, please leave it in the comments. The more hands off and lazy, the better. The less work I have to do to save money, the more likely I am to do it and the faster my savings will grow!