Debt, the Depression and You: How to Start Savings and Fix Your Money Problems

By: Jo Ann LeQuang
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[ Posted On: 2007-12-23 ]

Saving is not going to feel natural to you if you live a normal hyper-busy, super-active, overbooked, overcaffeinated, major-stressed lifestyle (that is, if you're a regular person). Saving is something that takes some time, requires patience and care, demands calmness and confidence, and involves both work and inconvenience. For most of us today, saving is just plain old too much trouble.

Shower curtain rips? Buy a new one. Feeling hungry? Let's go to a restaurant. We toss thousand-dollar birthday bashes for preschoolers and put our high schoolers in designer gear so they can be bored in a drab classroom (and we buy them a cell phone so they can text dopey messages to their friends).

Our Depression-era ancestors would shake their heads at such nonsense. It's no wonder Americans can't save their money.

Now, to be fair, people in the Depression did not save much, either. They didn't have much. They learned a lot of skills that got them through the year with minimal expenditures.

If you can do that and still earn what you earn, you'll have saved a whole lot of cash. So what can you learn from the Depression to make your present day more comfortable?

If you have frugal friends, try to shadow them for a while and pick their brains. Where do they shop? How do they live?

Repair things that break or try to make do without it rather than replacing it immediately. Buy clothing at yard sales and thrift stores, at least for a season. Start to find creative ways to amuse yourself (play cards instead of going to the movies) and cook rather than eat out.

Most people hate the thought of that sort of lifestyle and for good reason. It seems boring. It seems harder than it needs to be.

But the trick is that every time you do something like this you should reward yourself by taking the money would would have spent and stashing it away. If your checking account is a bottomless pit, try to take some cash and put it away in your room.

For instance, if you normally eat out four times a week, switch to home cooking and then calculate your savings. Let's say you used to spend $160 a week on eating out and you're now spending about $60. Make sure you pay yourself that $100.

That's saving!

It's so far removed from the way most of us think today that you have to discuss this strange new concept to get it!

Let's say the toaster breaks and you fix it. If a new toaster might have cost you $30, put $30 in your savings.

If you need jeans but get them at a yard sale for $2 instead of a department store for $200, put $198 aside.

At some point, you'll need to transfer your wad of cash to a more reasonable holding area. Open a special bank account or, better yet, start a brokerage account and put it in a stock or mutual fund.

A good method for doing this is to keep cash up to about $400 (or whatever amount you prefer) and then deposit it.

If you have debt, take your savings and dump it periodically into your checking account and then quickly (very quickly) write a check to pay down your debt. Imagine if you could live more or less at the same level and pay down your debt.

Frugality is one of those deceptive things that seems like it shouldn't be fun (but actually is). When the Depression hit American in the last 1920s, people skrimped because they had no other choice. But for us, the decision to save is about personal choice and a desire to be free of debt and build up savings for the future. Instead, look at frugality as a way to express your creativity and improve your life rather than some sort of limitation.

Here are some more creative ways to simplify your life and save money:

Rent movies instead of going to the show; better yet, start a home movie group with other families so you can do a pot-luck dinner and take turns being host. Not only is this more fun (and more likely to make real memories and friendships), it's cheaper.

Read books and magazines at the library instead of seeking your entertainment outside.

Learn to sew. Repair your own garments and learn how to make adjustments to get yard sale stuff to fit just right.

Learn a craft that is suitable for gifts. For instance, you can knit baby blankets for showers or needle point art work for Christmas.

Forget coupons, learn to buy in bulk and cook from scratch. Invest in a freezer, if you can afford it, because it's cheapest to buy staples, cook in large batches, and freeze. It's healthier, too, plus you'll develop a real knack for cooking.

Savings is a mindset. When you change your mind about your money, you can change your financial future.

Article Source: http://www.afroarticles.com/article-dashboard

About The Author: Jo Ann LeQuang -- If you want to know more options about managing your money, check out www.debt-consolidation-diva.com . We don't make loans, it's pure information on debt consolidation, which is an option for dealing with debt for people with good (or growing) ability to save money.

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