ICFE eNEWS #13-07 - April 24th 2013

Savings: When will you begin?

Perhaps saving now would be easier for many people, IF they made more money now. Is that the main reason people in America are not saving?

When it comes to saving money, most people will simply stop at nothing. There are many excuses which some people defend as logical and reasonable. People use these excuses not to save any money at every age (or stage) in life.

Following are some comments consumers of all ages about why it is difficult for them to save money.

Ages 17-23
Me save? Are you kidding? I am just getting my education. You shouldn't expect me to be able to save anything now. Besides, I am younger and want to have a good time. When I finish college and start my career, I'll start saving.
Ages 24-30
You don't expect me to save now, do you? Remember, I have only been working for a few years now. Things will be looking up soon, then I will be able to save. Right now, it is important to dress well in order to make good impressions. I'll wait until I am a little older, there is plenty of time to save, isn't there?
Ages 31-42
How can I save now? I am married with children. Why I have never had so many expenses in my whole life. Perhaps when the children are a little older, I can think about savings.
Ages 43-55
I wish I could save now. But, I just can't do it. Two of my children are in college now and it is taking every cent and more just to keep them there. I have had to go into debt these past few years to meet college bills. But, that won't last forever, and then I'll start saving.
Age 56-65
I know I should be saving now. Money is still tight. It is not easy for people my age to better themselves. About all I can do is hang on and maybe something will happen to change the circumstances. Why didn't I start to save 30 or 40 years ago? Like I said, something might turn up.
Ages 65 and above
It is too late to save now. We are living with our oldest child. It isn't nice, but what else can we do? I have my Social Security, but who can live on that? If I had only saved when I had the money. You can't save after there is no income.

Everyday Spending Decisions Shape Your Savings Growth

Answer seven questions and get a snapshot of your spending style.

1) Always set aside at least ten percent of income for savings and investing using the payroll deduction method.
Yes No Sometimes I manage to put some money aside.

2) Always contribute maximum amount to employer sponsored pension plans in order to get the maximum contribution from employer every year.
Yes No Contribute some, but not sure if my employer even matches any.

3) Always use manufacturer's and retailer's coupons when possible and send in for rebates.
Yes No Use only instant rebates and coupons, otherwise no time to clip them out.

4) Always look over sale flyers and comparison shop before I spend, especially for food.
Yes No Occasionally I stop in at a place and I will get the money saving special.

5) Always comparison shop motor vehicle and household insurance policies when they come up for renewal.
Yes No Policies automatically renew, never thought to check.

6) Always pay credit and charge card purchases in full when the statement arrives and never pay interest charges or penalty fees of any type.
Yes No Sometimes I take up to two, three, six or 12 months to pay off purchases, but never calculated the extra costs.

7) Always keep banking and other receipts, even for smaller purchases, and note on them the details.
Yes No My important receipts are on my credit card bills, otherwise, unless I will get reimbursed for the expense by somebody else, I pitch everything else.

Scoring: 100% = 7 yes answers

7 Yes
A wise spender you are and a spender mentor you should become.
6 Yes
You are right up there with the minority, however, how much would the money you could save, in the question you answered no to, be worth in 12 months if you invested it?
5 Yes
Getting close, but no big savings payoff yet because you may still be missing out in the areas of the questions you answered no. If you want your assets to grow, look for saving in every area of your spending.
4 Yes
You are past the half way mark, however, if you do what you have always done, you will always get what you have now. Time to change some spending habits if you want to see a brighter financial future. If credit cards are your bane, try something that will remind you about the dangers of spend, spend, spend, like credit card warning labels and protection sleeves with anti spend messages for your credit / debit cards.*
3 Yes
Get off the money-merry-go-round! You are probably living from paycheck to paycheck or earning upwards to $100,000 a year and have little or nothing to show for it. Poor spending practices must be doing you in. If you need a quick shot in the wallet, the average household spends 30 cents of every take home dollar on household and grocery items. You can make a big impact there the next time you go to the grocery store.
2 Yes
When it comes to saving money, you must stop at nothing. Kick it up a few notches, you will be amazed at the results. You have an obligation to be as good to the person you are going to be in 20, 30 or 40 years as you are to yourself today. Start saving and spending with your future in mind.
0-1 Yes
What is that smell? Smoke from your credit cards being overused? Put them in a glass of water and freeze them solid. If you aren't in credit counseling or bankruptcy court, both could be right around the corner. Outside intervention is what you need now. And start looking for a spender mentor, quick.

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Sent by:

Paul Richard
President - Executive Director
Institute of Consumer Financial Education (ICFE)

ICFE - Institute of Consumer Financial Education - ICFE.info - 619.239.1401