Financial Independence: Steps to Saving Money.

Like the old guy flying a kite in the middle of a thunderstorm says, " A Penny Saved is a Penny Earned," but that Benjamin didn't have Starbucks on every corner, so what does he know? Well, in a time where they were taxed on any and all paper goods, their right to a good Earl Grey tea, and everything from glass slippers and glass menageries, he did know a thing about seeing his money going right down that capitalistic drain pipe. I am sure he could not fathom the economic booms that our American history has experienced, but, nonetheless, he would stand by his stance on saving for the future, avoiding those unnecessary calories and interest rates. So, how do we, as consumers, living in a world of instant gratification and Amazon packages at our fingertips, go from saving that penny, to actually saving that Benjamin? This is my list of money saving practices that help me on my own quest for Financial Independence (Yes it deserves to be capitalized), becoming debt free, and learning to put my money to use working for me, not just me working for that money!

1. You Must BUDGET: One of the biggest pit falls we have when it comes to money is the practice of spending way more money than we can pay off. It becomes second nature to swipe that plastic when we buy our Mocha Latte Cappuccino espresso with a dash of cinnamon and topped with whipped cream, but like any habit, we can bend if not break it. We need to be accountable for the amount of money we are bringing in and the money that we are sending out. This begins by creating a spreadsheet that calculates each and every item that we spend our money on. Rent. Food. Gas. Retirement. Everything. Then we can visually see where our money is going each month. But it doesn't stop there. I like to implement something called Zero Out Budgeting which allocates the amount of money we have to each of those individual accounts. When the budget is complete, we should not have any money left over, which in theory, means we don't have extra money to spend on frivolous purchases.

   1. For Example:

I make $2500/month after taxes.

$500 = Rent

$400 = Loans

$250 = Car Payment

$250 = Retirement

$100 = Insurance

$100 = Utilities

$100 = Gas

$100 = Food

$100 = Household Items

$50 = Subscriptions (Gym,Netflix, etc.)

$50 = Date Night/Personal

= $2000

Leaving me with $500 left over after I have allocated all my expenses. Without writing everything down, we may never have discovered this leftover money, which often goes right into someone else's pocket due to inappropriate spending. So, what should I do with this additional $500/month? Should I go out and treat myself for taking the first step to financial freedom?! <SLAP> Absolutely not! You have just been given a gift that can help you get ahead in life and reach your goals to financial freedom. If you have the ability to pay off high interest rate debt, do that! High interest rates constantly keep us down by charging excess amounts that ultimately pile on top of a mole hill of a loan. By taking this additional amount, we can see that mountain of a loan, shrink back down to its original credit. If you have already paid off all your debts, first off, Congratulations! That is very impressive! Should we treat ourselves now? <SLAP SLAP DOUBLE SLAP> Now you are given the opportunity to invest in your future and really excel in financial freedom. A step to breaking those chains that keep us from getting up every morning to attend our court mandated 9 to 5. By utilizing our additional wealth, we can now start our journey into investing into the stock market and growing our wealth. Another blog post on that later, let's get back to breaking our spending habits!

2. Subscriptions: Do we have too many? Are we paying for things we aren't using? Often times we get pulled into monthly contracts that we often forget about until it is time to pay for them, which at that point it is too late. Or is it? Often disputing charges and cancelling subscriptions early can result in a full refund, and one less item you are paying for, but not using. This includes, but not limited to: a gym membership, Netflix, Hulu, Disney+, Amazon Prime (Do we need all of these, can we go halfsies with a friend?), Food delivery, Home Goods, and much more. Take the time to look at where your money is going and really, and I mean really, evaluate how often you use them. Those charges add up quickly and can often lead to saving hundreds of dollars each month.

3. SAYING NO! This is most likely the hardest lesson we can learn in order to move forward with our financial independence. We are submerged in a social media world and our desire to "seem" active often floods our wallets, and ultimately creating an incurable FOMO that we can't shake. And guess what? It is okay to turn down offers of spending money. It really is. No ones loses out. No one gets hurt in the end. What you do gain is a couple of hundred dollars that can be used to invest for the future, pay off credit cards, or put away for a rainy day, instead of throwing it at some overpriced ski trip to Colorado when we sure as hell know you can't ski. But this doesn't limit itself to just big purchases. If you said no to every urge for that delicious Pad Thai from that local place around the corner, which we know is your go to two or three times a week, you can in the long run save 75-100 dollars a month, just by trying to cook it yourself. And if you find that you aren't Gordon Ramsay, or even close, well the Frozen pizza for $4 is just screaming your name. All in all, our ability to say no will save us thousands of dollars each year. Point. Blank. Absolute. An alternative to constantly saying no is easily solved by creating a list of free or cheap events that bring you just as much if not more joy. Stick with that until you get your financial bike back on the road to success.

4. Research High Interest Rate Savings Accounts: We often leave our money in the same account we have had for years, unknowingly losing out to possible high yielding interest rates from a more established institution. With a little bit of research, we can find accounts that could offer us a rate of 1.5% per month which is 25 times the national average. With some institutions offering pennies, while others are accumulating tens of dollars, reinvesting in itself. There isn't one person in this country who would turn down free money, so why are we voluntarily doing that? Once we reach the pivotal step in this journey where we stop working for money, and our money starts working for us, that is when we know we have made it! True financial independence and the ability to retire without any hesitation that they need money, because we know our money, by existing, is generating its own income. Do your research and find the banking institution that works for you, and keep an eye out for new account promotions offering even more free money.

Ever since we accumulated an allowance from our parents, or found a dollar on the ground outside the local piggly wiggly, we have never been taught the value of a dollar and what its true potential could be. Because of this, we as adults have to teach ourselves. We can read books, watch YouTube videos, ask experts, and implement practices. It is never too late to learn about financial independence. I knew nothing about turning my money into more money, or strategies to help better prepare myself for the future until I was 25, much later in my money-making years. It is never too late. The biggest challenge will be taking this information, implementing it, and sticking with it. Often, we "relapse" for that Starbucks overpriced coffee and it's a slippery slope from there. You have to ask yourself, which would give you more satisfaction? The immediate gratification you get from swiping that plastic for your favorite "Treat Yo Self" splurge, or the satisfaction of retiring early, paying off your house, or preparing your child for higher learning, all without breaking the bank. If you said the first option, then I am surprised you made it this far and all of these words will simply slide right out of your ears and I say "SALUT!" and have an $10 cocktail for me. If you said the obvious answer, then great, you aren't completely hopeless and you have a big future ahead of you of hard work, strategic budgeting, and stay at home cocktails! A penny earned is still a penny saved, but we got bills to pay and we need way more than a measly penny, so let's get to work!