SAVE $1,000 PAIN FREE: Baby Step #1
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Saving money is hard! Seriously, it seems as if I put aside some extra cash for expense “A,” it always ends up going towards expense “B – C – or D.”
Want a real-life example? We’ve been saving up to buy a new car. Do I have a new car? Nope! But I’ve spent money on braces, a new washer and dryer set, and new garage doors! (Yes, our garage door fell off its hinges…it was a mess!)
But here’s the thing: We’ve had the money for those ‘emergencies’ because we’ve learned to save and build up an account specifically for those unexpected expenses.
We follow the Dave Ramsey’s 7 Baby Steps program for living debt free, building an emergency fund, and saving for the future.
What’s Baby Step #1?
I’m not going to overwhelm you with all 7 steps at once. But here’s the first step you can take to living a stress-reduced and debt free lifestyle.
Step #1: Save $1,000 to go towards those unexpected expenses!
It’s not a question of “if” you will have unplanned monetary needs arise – it’s a question of “when.” Being prepared for those expenses will allow you to tackle them head on without having to take out a loan or falling behind on your mortgage payment.
When my husband and I first started this program, he was working part time while finishing up his student teaching semester for his degree. I was homeschooling our 2 biological children and I stayed home full time with our 3 foster kids we had at that time.
Needless to say, money was tight. Yes, there were times we struggled with decisions about whether to go out for dinner, or eat beans and rice – again. And yes, we cut other unnecessary expenses such as our TV/Cable bills and we used Go-phones instead of hitting up the newest iPhone. But we were able to save up and start an emergency fund.
What was the benefit? When an unplanned trip to the doctor’s office or when the garbage disposal decided to stop working – we had the money to take care of it. Did it suck? Yep! But it wasn’t the end of the world.
If you’re looking to save at least $1,000 – here are some steps from the Every Dollar Budget Plan to start saving for those unforeseen expenses.
5 PAIN FREE STEPS TO SAVING YOUR FIRST $1,000
1. BUDGET, BUDGET, BUDGET!
You can’t know how to save your money if you don’t know where your money is going. If you need help see HOW TO CREATE A BUDGET AND STICK WITH IT.
2. CUT SPENDING
It’s not going to hurt you to NOT go to the movies for a month while you’re trying to set aside your first $1000 for emergencies. You may have to stick with store bought coffee instead of going to Starbucks, or keep snacks in the car to help avoid those last-minute trips to the drive through because you’re hungry.
Remember, it’s not forever. Just be disciplined for a time so you can reach your goals. Once you have the financial security to live the life you want – then you can start adding those things back in if you so choose. But define what’s truly important to you and cut out the things that aren’t.
3. INCREASE YOUR INCOME
You may want to take on a side job – or just find your hustle! You can walk the neighbor’s dog, cut their grass, baby sit – anything to earn you a little extra cash.
Want to learn how to make money online? Check out these resources.
4. TAKE A SECOND LOOK AT THOSE BILLS
Do you have bills you can cut? Even if you cut your cable bill for a short period of time (say 1-3 months) how much could you put away? It may be worth it to look at other, less expensive, options for your regular bills – internet, cell phone, insurance, etc.… It pays to shop around and see who has the better deals. Just because it’s what you’ve always done, doesn’t mean it’s what you should continue to do!
5. CREATE A GOAL AND BELIEVE IN YOURSELF
Sit down and decide what’s a realistic time frame for you to be able to save your first $1,000. Make a commitment to live under your means – meaning live on less money than what you make so you can save – for a set amount of time. It will be easier knowing you can go back to normal on a specific date – and then try to beat your goal!
It may seem hard and very overwhelming at first – but I promise you that if you follow these steps and you make up your mind to do it – anything is possible. The benefits of having money set aside for those expenses will manifest themselves once those unexpected bills start rolling in.
Bonus Ninja Tips:
1. Don’t touch your funds!
This $1000 is for EMERGENCIES ONLY! Going to Disney world, or taking a weekend in Vegas is NOT an emergency!
2. If you can spare the money with your current budget – do it!
If you have an unexpected expense come up after you already have your $1,000 but you can cut and save from your current monthly budget to cover it – do that.
3. IF and WHEN you must spend your emergency fund, repeat steps 1-5 to build it back up!
Yes, you might have to start over, or you might only need to save half – but once even a little is gone, work to replenish your savings.
4. Know the difference between and emergency and non-emergency.
Your car needs a new engine – emergency.
Your kids breaks their arm – emergency.
You really want a new chihuahua – not an emergency. (no matter how cute you think they are)
There’s a computer sale – not an emergency! If you own something that works (even if it’s not as good as what’s out there) it’s NOT an emergency!
Of course, you should decide for yourself what is and what is not worth it when it comes to spending your money. But ideally, you will set aside your $1,000 quickly and then not have to touch it again! It will give you a little pace of mind knowing it’s there for when you truly need it.
Do you need help budgeting, saving, or cutting your spending? Let me know in the comments below! I would love to brainstorm ideas with you to get your emergency fund up and running!
Questions, comments, or just want to say Hi? Drop me a comment below! What are other ways you’re being a money saving ninja? Feel free to share your tips and tricks below!