Save-to-Spend Plan If you would like to become an avid saver, download the Save-to-Spend plan below. While most budgets are designed to control spending, this one is designed to expand your saving.
Here's the plan, based on a monthly income of $4,000. 1.Set aside 10% per month for retirement. ($4,000 x .10 = $400) 2.Save 10% for long-term needs, i.e. a new car, a down payment. 3.Save 10% for short-term and unexpected expenses, i.e. a friend's wedding this spring, replacing a lost cell phone. 4.Stash a final 10% for fun, frivolous, pleasure. Total saved: $1,600
The beauty of this system is three-fold: 1.By creating stashes of cash, you will be able to cover all your expenses—especially the curveballs—and avoid relying on little Ms. Visa. 2.As you ramp up your savings, you'll pare down your spending, because you'll want to save. 3.You never feel like you're on a budget. You feel rich, because you have cash growing in your accounts.