So this Savings Challenge I do every year, well, since 2009 at least........I use the previous year's SC $ saved as an emergency fund for the following year.
IE-the money saved in 2012 was used to fund emergencies & irregular expenses in 2013 when regular income didn't cover everything.
Then at the end of following year, when all the emergencies that were going to take place had, I took whatever was left in that SC and put it into an interest bearing non-retirement account of some sort and it became "permanent". And hopefully when we retire it will be added to our sack o' money/retirement funds.
I started my personal Savings Challenge in 2009 when I was on a Yahoo group called "The Compact". I was younger and pretty naïve about how much I could save from our income then and challenged myself to put away 60 THOUSAND DOLLARS! Yes, 6 with 4 Zeroes after it. lolz
I didn't even get halfway there.
But you know what?
It didn't matter that I failed at my goal.
What mattered is that I had a concrete number goal and I saved something even if I didn't achieve that goal number!
They say it's hard to save money if you don't have a target so figure out your target. Then you can set about figuring out how to reach it.
In 2009 I saved
$23,865.36
We used $13,460.81 of that money in 2010 for unexpected expenses, sending the remaining
$10,404.55 to permanent savings.
In 2010 I saved
$34,019.88
We used $427.81 of that money in 2011, sending the remaining
$33,592.07 to permanent savings.
In 2011 I saved
$34,461.31
We used $2,627.16 of that money in 2012, sending the remaining
$31,834.15 to permanent savings.
In 2012 I saved
$28,907.08
We used $23,611.66 of that money in 2013, sending the remaining
$5,295.42 to permanent savings.
In 2013 I saved
$24,033.60
We used $0.00 of that money in 2014, sending the full
$24,033.60 to permanent savings.
In 2014 I saved
$27,427.06
We used $0.00 of that money in 2015 sending the full
$27,427.06 to permanent savings.
In 2015 I saved
$40,000.00 and this will be the pot of money we draw from for any emergencies/irregular expenses in 2016 that we can't cash flow, before sending whatever remains to permanent savings when the year ends.
You can see from above that some years we had many unexpected expenses and most years we had few.....what we spent from the previous year's savings varied from $23,611.66 in 2012 to using $0 in 2015.
I am just thankful I DID save money because if there hadn't been that pot of money sitting in the bank in 2012, we would have had to delay or worse,
put some of those expenses on a credit card!
So with 6 full years of my Savings Challenges(2009-2014) tucked away for our retirement years my total is sitting at $132,586.85.
Again when 2016 is over and everything is paid for, whatever is left from that $40K I saved in 2015 will go into permanent savings for our retirement years.
************
Now I need to settle on a savings goal amount for 2016.
Since we actually saved $40K in 2015(without the bonus $), I think I'll keep the goal at that level for 2016.
$40K is possibly doable for a second year, given our income level, but it's not a given. If I keep my frugal nose to the grindstone and no big expenses wallop us this year we could make that number again.
$40K averages out to saving $3,333.33 per month.
Now how do I plan to get to this goal?
I'll remain frugal in my spending, keeping our living expenses as low as possible.
* We'll keep food spending in check.
* Utility bills will be monitored and usage adjusted if it gets too high.
* Gift giving costs and Christmas spending will be tracked.
* We don't foresee any larger car bills this year(as 2 of the 3 cars are newish), our housing is basically sound and HVAC systems are running well so those expenses shouldn't be a factor in 2016, just gas for cars and regular maintenance on cars and house systems.
*
Entertainment will be sought out that is inexpensive or free.
* Travel will be done on the cheap if possible.
* Clothing spending will be low this year. Last year much of
College Boy's wardrobe was replaced and I also bought clothes for the Daughter but those costs won't be duplicated in 2016. I'll try to do some sewing when I need clothing items replaced and Hubs is good to go with his wardrobe.
Items that may hijack my saving goal--
* We will have some extra expenses in 2016 with home repairs(getting things ready to sell in a couple of years).
* Hubs current medical issue with no resolution in sight yet, so t
he medical co-pays are a wild card in the spending plan. Also any unforeseen medical issues that may crop up during the year.
* 1 child still in college and dependent on us and another child still on our medical insurance will mean higher spending than if we didn't have dependents at this point in our lives.
So who wants to play along and save some of their income in 2016?
Figure out what you can reasonably live on and put the rest away for your retirement....or if you still have debt(and why do you still have debt at this point in your life?!?)put something extra this year toward that goal and get yourself DEBT-FREE and/or MORTGAGE-FREE before you retire.
Set whatever goal feels right for your life. Experts have said that people who set goals do better with their money overall. Set a goal to keep yourself accountable. Better yet, post a goal on your blog or in a community forum online and let other people's eyes help keep you
more accountable. 8-)
Yah, it might not be fun to track your expenses but if you don't know where your money is going(and with most folks the money DOES GO!)how can you know if you keep any and how much you keep?
Tell us your savings goal for this year and how you plan to go about achieving that number.
Sluggy
