Have you every looked at your bank account and said, “Boy, I wish I had more money?” I know I have.
I often tell my clients that there is only one way to save money. Save Money. It may sound a bit simplistic, but the only way to save money is to not spend it.
I’m going to give you a sure fire way to save money. I’ve been doing this for a number of years now and it works wonderfully. I came up with this idea by reading the best book on financial management The Richest Man in Babylon. In that book it says to save 10% of everything you earn.
Here is how I implemented this idea. Whenever I make a deposit into the bank account I transfer 10% over to my savings account. It works beautifully. Over time, my business has grown and the volume of customer deposits I’ve received has increased. I found that it became cumbersome to do a 10% savings transfer for every customer deposit I receive. So I decided to change my discipline. Now instead of doing a savings transfer with each customer deposit, at the end of the month I look at my bank account and I transfer 10% of my total deposits to my savings account.
Part of the beauty of this simple discipline is I segregate my savings from my checking account. Mentally when I look at my checking account, I think that is money I spend. When I look at my savings account, my first thought is that is my savings. I worked hard to earn and save it. I don’t want to spend it.
Now what happens when an unexpected expense comes along or my income drops a bit? I have my savings and I can always move the money to my checking account. That’s what savings is for. I don’t have to put the unexpected expense on my credit card, because I’ve got the money in savings.
One of the other great things about continually putting money into savings is that I will always be saving money.
Remember there is only one way to save money and that is to save money!