Monday, February 4, 2013

Long Term Savings vs. Short Term Savings - I Can Save Article

People talk about saving money all the time. Reducing clutter, cleaning up their lives, getting organized, being more productive. They all seem to go into the same category somehow... magazines, bloggers, and news columnists have classified this as a 'lifestyle' post. But what does it all really mean? I can't tell you what it means to everyone but I thought I'd start a new mini series of articles about what it means to me.

This is the first of those articles: Long Term Savings vs. Short Term Savings.
I'm talking about saving money here, not time... or sanity. Just money. First you have to realize there's more than one type of savings. You can clip a coupon for something you needed, take the coupon to the store with you (let's say the coupon is for milk) and then you hand the coupon and the gallon of milk to the cashier. You've just saved money.

But what if you didn't need the milk? what if you had 2 gallons in the fridge already going bad because the coupon was so wonderful you couldn't help yourself but to use it? Now did you really save any money at all? No! You just spent money to 'save' money which is completely pointless and not only a waste of money but also a huge waste of your time!

Second there is long term savings. You decide since you watched a YouTube video on how to cut little boys hair you're now going to cut your own kid's hair, your husband's hair and your best friend's hair all to save everyone money. So you purchase a hair cutting kit for $49.99 on Amazon and you start cutting hair (first of all don't cut anyone else's hair for money it's illegal with out a license, and secondly please shop around that's a bad price on a hair cutting kit... but let's say you did it anyway...) so you start cutting hair. You do it for one month, ruin everyone's hair, they are all now really mad at you because they look like porky-pines and you throw the kit away while in a gigantic argument with your husband. Did yous ave money? NO!!!

HOWEVER, if you watch a dozen videos on how to cut hair, and start with a really simple project (maybe a baby doll, or just a trim) and you realize this is something you can totally do! You shop around buy a kit at your local store for $39.99 and you do the trims in-between the big hair cuts, and still send your husband to great clips for that (not that they do any better of a job really) did you save money? Yes! Start small, start with something you CAN DO. If you can cut hair, or learn how... do it! that's a long term savings. you invested a little more than a hair cut up front, BUT you can now avoid going down the street and paying $15.99 at least 7 months of the year, maybe 12 if you get comfortable with it!

So once you've decided you want to start saving, decide where you want to start. Start with just ONE THING. Say "i can clip coupons for toilet paper" and do that. Just try that one time. Did you do it? Did you save money? Then do it again!

Getting in over your head, overwhelming yourself, and getting obsessed with getting a good deal, is a really bad way to save money. You'll spend more time, more aggravation, and more money on saving money than you would have psent int he first place. Start small, find something you CAN DO or you can learn to do. And, go from there. It's just like working out if you start with a 20 minute walk, you CAN run a marathon, but if you never start walking, you'll never end up running.

Same applies to savings, and learning to be more frugal. Evaluate what you can save on, and you'll learn to save on everything else, one coupon, one cut back, one stepping stone at a time.