CNN Money Article on saving money for retirement.
I received this news article from a co-worker of mine and thought it was very significant because its content lines right up with my opinions on consumer spending and saving.
Basically a person with a smaller income can still save more then a person with a larger income just because they spend less and save more. Read it for yoursefl.
CNNMoney.com News: “What works: Your worst enemy…overspending”
By: Penelope Wang
http://money.cnn.com/2006/09/07/pf/retirement/retire0610_whatworks_hartmann.moneymag/index.htm
In my own life I can see this with my friends earning more then me, but they want to spend and buy a sports car, new furniture, and have their own place instead of sharing. Just by owning your car with no payment you are saving $100-500, sharing as a roommate instead of having your own place saves your $300-1000, and buying or getting used furniture could save your hundreds if not a couple thousands. I know its personal choice, luxury, and enjoyment. Can’t you have just a good time driving a regular car, or sitting on a used piece of furniture. Having a bran new furniture set doesn’t make it come alive and talk to you does it? I don’t think so. Sure, comfort, you want it but you still can have it being more on a budget and finding a reasonable simular piece of furniture cheaper would help you save in the long run. As with expensive cars comes higher insurance just another thing to think about when spending your paycheck.
In the article stated above they are earning a sweet income, but if with a $20,000 to $40,000 yearly income you can save just as much.
I factor variables like (for males and females):
1. Do you have a boyfriend, girlfriend, or are you married?
2. Do you own or do you rent or which is cheaper?
3. Do you own your car, leased, or have a loan on it? What’s the insurance?
4. Do you eat out a lot, binge drinkers, or like to go out a lot on the weekends?
5. Do you play sports? Because most sports are free.
6. Do you have credit cards and how much is on them?
The above questions can help you budget your money better and plan for retirement. Yes, people change, you get married, you have babies, and now you have a hospital bills because you don’t have health insurance. I understand that, but if right now you are young, healthy, and able to work then now is the time to earn and save the most you will ever be able to.
Think about how much you spend in your current lifestyle. If you can makes changes you’ll be saving probably 25-50% of your paycheck and be blown away when you see your savings account start stacking up like gold inventory as in the Federal Reserve in NYC, NY.
Pay day is my favorite day. Don’t let your hard earned money slip away!
In the military just as in the corporate world we are basically paid twice a month. The 1st and the 15th. As a previous pizza delivery driver those days were the best to make money on. Some drivers would just only work on those days because tips are better because people are paid. Now I am going to talk about saving your hard earning pay day money. Creating some type of budget if it be in your head or in a planner book. You need to know what you can and can not spend because if you don’t how much free money you can have to spend you will end up with nothing left to save until your next check. Many people live paycheck to paycheck. It has even happened to me when I was very young. At a certain point I just understood the meaning of money and the bigger vision of keeping more of it would get me ahead in the future. Try to save at least 25% of your income. Currently I earn around $3000/m after taxes. Not a lot for living in Hawaii, but enough to be about to save at least 35% or $1000/m to invest with. My ideal thinking is to invest everything I can into stock market options. At some point I am going to be very right. I have been actively studying the stock market for over 10 years and just recently stock options for the past 2 years. I’ve learned a lot and I’m starting to trade smarter from doing mistakes I’ve already been taught not to do. I can’t say I am much of a rebel, but everyone at some point is a child and you are going to get spanked hard by one play or another to teach you a big lesson. Sometimes loosing so much money in the market can be a very huge motivating push that can help you go from rags to riches.
Now back to pay day. If you are going to be better off the next month you need to have it in the bank. Call it saving for an emergency or cushion money or even money you are willing to give up for a bigger vision of your future. Yes, I have lost money in the market. I’m working on making my losses small and my profits larger. For every person that is loosing money there is someone or some investment firm making it and I want to become that person that profits. I know what you are thinking. No way I want to loose money in the stock market and you are right. You need to study and have conviction about when you trade know absolutely your trade is going to work. If you don’t feel the stock market is your veichle for future cash flow then consider saving around $5000 and buying a condo or small house (getting 100% loan financed only paying closing costs). I bought a small home and receive $725/m rental income from it with a $653 mortgage. Not much rental income but owning it pays off HUGE with my yearly taxes receiving more paid out money and I can say I own something.
I hear many people say they want to take some money from their paycheck and invest it in bank deposits and bonds. Personally I just don’t think you make enough for your money just sitting there, but if you don’t believe in a little more risk creates a much bigger return then do it. I just hope I can motivate a person to save money. Everybody just seems to spend it all then they think I’m rich because I don’t spend mine. It’s choice, you’ve got it and so do I so use it and think long-term with a short-term money management style to create more choices for you and your family long-term.
Here’s a story of my parents. I remember as a child listening to WHRO 90.3’s 5 P.M. wall street radio broadcast of the Dow Jones Industrial Averages and Nasdaq Monday through Friday. My parents would invest $50 a month into 1 local company every month and did this for years. 12 years later with around $8,000 saved from buying 1 to 2 stocks to equal $50/m now they have the choice to help them buy their dream home, a new car, help pay for college, use for medical, or just keep investing. This is the power of saving and investing even as little as $50/month. My parents never made much money probably together less than $30,000 a year having 4 children. We lived in a small town-home, ate crockpot soups, rice, and simple meals rarely getting fastfood or deliveried pizzas and really never going out to a resturant. We sacrificed a lot of luxuries, but I feel as a family we were happy. Christmas was never expensive because we always found it fun to buy a million gifts from the dollar store. Sure it sounds ghetto? It isn’t. My parents made an attempt to buy us each at least one nice gift whether it be some new clothes, a bike, or something we needed not necessarly something we wanted.
Remember a small sacrifice to start saving your money can pay off big when you need it most so start now.
My first blog inspired by other financial bloggers aimed to help individuals learn how to increase their goals to a faster retirement.
Hi. I’m Paul Meyer and will be writing this blog under the name Finance Ninja. I thought up the name fighting between Money Kung Fu and my cyberspace nerd name elektrowhiteboy. I’m an ordinary big nerd. I think up the craziest things to say, do, and help people with. I am great at saving and creating ways to make money. So I thought Finance Ninja was the best general name for this blog I’m going to pour my heart and soul into. Unlike other financial wisdom bloggers I am going to go down other dark roads to help you learn more about the power of money. Money can help you or destroy you, and you really need to choose right now in your life what it will be.
I am currently in the United States Coast Guard serving a 4 year term with around 3 years and two months left at this point. I’m very confident in my decision in join the USCG to save money, surf more waves, and live in a fresh new place. To make a comment on that you can move anywhere, but you will always be the same person inside so lets find out really who you are and help you manage your money more efficiently.
My name is Paul. I have an addiction and it is saving money.
Paul Meyer 