My first few months after graduating college I lived in constant fear of running out of money. The salary from my job was just enough to cover rent, bills, groceries, savings, and left a couple of hundred dollars for all else. I remember being so excited to have my first apartment to myself, but not having enough money to decorate it the way I wanted to. One of my biggest fears after graduation was that I would run out of money and have to call my parents to bail me out. I needed to prove that I could manage my money wisely, but that turned into depriving myself from everything that wasn’t a necessity.
After being fed up with that, I made a few changes to the way I dealt with my financial situation. One, I created a budget spreadsheet that I use almost every day. And two, I created a separate bank account for the fun stuff.
At first this bank account didn’t have a real purpose. I knew I wanted it to be “guilt free” money, but I was not sure for what exactly. So I would go shopping and buy things I really wanted (my first purchase on the card was a vinyl record player—best fun purchase ever!) However, since the account really had no purpose, I was spending the money here and there on little things and I was not getting the satisfaction I was wanting.
Then, at the beginning of 2017 I started to redefine my goals (new goals for a new year, groundbreaking I know). I had just gotten back from a family vacation to Cancun and completely obsessed with traveling more. So I made a decision and started saving in my travel account. I started small, and built up over time to get where I am today. At my rate currently, I am saving $2,600 a year for travel! Crazy right? A small amount every couple of weeks makes a big difference. The best part is that the amount is constant every other week. I can plan for a trip in December, and calculate how much I will have by multiplying $50 for every week up until the trip to see what I will have to spend.
How to Save for the Fun Stuff
If you would like to take the same journey I did and have a separate account for the things you love (or just save money to your regular savings account), here are some tips I have to get you started:
Pick Your Purpose
Don’t make the same mistake I did and save without having a specific idea in mind about what the money is for. If you don’t have a purpose for it, you will spend it on unimportant things that you will forget about in a matter of weeks. Think of something you love doing, but takes money. Maybe it’s a manicure, shopping spree, or travel like me. Find whatever makes you happy and that you would be excited to spend money on and write it down.
Set a Goal
Set a goal of how much money you want to save and how often. Start with something small and manageable and work your way up. I started off saving $50 every two weeks, then increased that to $75, and now it is at $100. Once you realize that you don’t even really miss that money, you can push yourself further and further. If you get a regular paycheck, I suggest you pick a schedule that coincides with those days. That will make it easier to save as soon as you get the money.
The best tip I can give you to make this as painless as possible is to set up autopay and let your bank do its thing. For me, I have $100 out of every paycheck of mine go to my travel checking account. This way I do not even see the money deposited into my main checking account, and don’t even think about it. It never touches the account I use on the daily basis, and the only way for me to use that money is to take out that particular debit card, or to transfer to my main account (which I never do).
Keep Reminders around You of Your Purpose
Saving is much easier when you can picture your goal. If you are saving for travel like me, have a board of travel destinations you would love to go to. If you want a shopping spree, keep a wish list of the clothes you will buy once you have saved enough money. Always remind yourself of your why. You will be less likely to back out.
Spend without Guilt
My last step of course is to spend the money without guilt. Go into your purpose and not feel bad thinking you are wasting money. You earned it! You saved it! You made a goal and stuck to it and now you get to enjoy the rewards. Keep mementos and pictures to use as reminders for your future saving.
In order to save the most money as painlessly as possible you should define what it is you are saving for, arrange a payment schedule you can stick to, set up automatic payments to that account, keep your purpose in your mind, and spend your money the way you want! This method is easy and effective, and I hope it enables you to spend more time doing the things you love.
What purpose would you like to save more money for?