My moth­er was born a saver. It is in her DNA. To prove this let me share one of her sto­ries:


“One of my favorite pas­times (when I was a lit­tle girl) was count­ing the change in my pig­gy bank. I always engaged in the rit­u­al alone in my room. I would lie on my bed and turn my bank upside down. Using a kitchen knife, I would cajole the pen­nies, nick­els, dimes and my prized pos­ses­sions, quar­ters out of the bank and onto my stom­ach. I loved the feel of mon­ey falling onto my bel­ly.”


For my mink piggy bankMy moth­er got a high off of count­ing her mon­ey, and this cre­at­ed a very strong habit of sav­ing mon­ey. I, on the oth­er hand, have strug­gled until recent­ly with sav­ing mon­ey. In the game of life I am a sprint­er, not a marathon run­ner. I am an instant grat­i­fi­ca­tion junkie.  So clear­ly I find it very dis­cour­ag­ing to save mon­ey every month, and look back at the end of the year and see all that hard work and sac­ri­fice doesn’t amount to much. Research shows that I am not alone in my strug­gles, but I want­ed to share a real­ly easy way to keep your­self moti­vat­ed while sav­ing mon­ey.


Like I said above, I strug­gled until recent­ly. I have found a way to get high off sav­ing as well, and it doesn’t include an Inde­cent Pro­pos­al type sce­nario (although that would be fun). The rea­son my moth­er kept sav­ing is because she could lit­er­al­ly see her moun­tain of mon­ey grow­ing before her eyes. In this day and age our mon­ey is just an ephemer­al num­ber on our smart­phone screen. It isn’t tan­gi­ble. Here is my way of mak­ing my mon­ey and my sav­ings seem a lit­tle more tan­gi­ble: do the math.


Basic Principles:

  • Start sav­ing and earn­ing inter­est as ear­ly as pos­si­ble.
  • Expect an aver­age return of 5 to 10 per­cent.
  • Only save as much as you can afford to save. Don’t dip into your sav­ings.


The Math (Based on True Life events)


I pledge to save $100 a month for 30 years at 5% inter­est. The first year I per­son­al­ly save $1,200, and make $60 from inter­est. This isn’t awe inspir­ing, but I made $60 by doing noth­ing! The sec­ond year I save the same amount, but I make $78. And so on….

  • The third year I make $189.15 doing noth­ing
  • 4th year — $258
  • 5th year — $331
  • 6th year – 408…..
  • 10th year — $754
  • 30th year — $4,000

That comes to a total of $47,529.95 for which I did noth­ing! I didn’t work for it, it worked for me! I mean I made more than I saved. I only saved $36,000, and made almost $50,000. Now if that doesn’t give you a nice lit­tle endor­phin buzz, and keep you moti­vat­ed I don’t know what will!


Below is a sim­ple way to cal­cu­late your sav­ings growth by your­self, or you could just use this handy-dandy Future Val­ue Tool for free.


Year One Total Sav­ings = (1st Year Annu­al Sav­ings x Per­cent­age) + 1st Year Annu­al Sav­ings


  Exam­ple: 1260  =  (1200 x .05)  +  1200


Sec­ond Year & On Sav­ings = (Pri­or Year Sav­ings + Cur­rent Year Sav­ings) x Per­cent­age + (Pri­or Year Sav­ings + Cur­rent Year Sav­ings)


           Exam­ple: 2583   =   (1260 + 1200)  x .05 + (1260 + 1200)


Hap­py Sav­ing!!

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