Six Ways to Force Yourself to Save

I have mentioned my elder son, who tends to pursue a less than industrious path at times. In contrast, I also have a son who zealously protects every penny that he gets in the hope that he can purchase a condominium and become his brother’s landlord. As my thrifty son pointed out, he assumes that my wife and I will always have to help his brother make rent and he wants to be the guy who is collecting it.

I can’t argue with his logic. I think he may even have gotten the idea from one of my previous articles, and he is very quick to find ways to use my articles against me. I also cannot argue with the way that he is stockpiling his money. He buys a new certificate of deposit every nine to twelve months, whenever the previous CD matures.

He has been doing this since he was about seven years old, when I explained to him that a CD will pay him more interest than a regular savings account. But that is not the only reason that he invests in CDs. He really likes knowing that he cannot get at his money for whimsical purchases. As he pointed out to his older brother, who mocks his CD purchases, “When I am older I will be able to afford a car, and we’ll see who is laughing then!”

With my industrious son as inspiration, let’s consider some great ways to force ourselves to save:

Buy Certificates of Deposit: Although interest rates even for longer term CDs are less than wonderful, they are still better than what you will get from a standard savings account. The next time you are visiting your bank, try to find a way to hide some of your money from yourself by putting it into a CD. Each time your CD matures, buy a new CD and add to it. Over time, you will see a sum of money accumulate that you will not be able to spend on a whim more than once a year (upon maturity)

Withhold Too Much on Your Taxes: Yes, I know, withholding too much money is like giving the government a free loan. Nevertheless, it is still a good way to ensure an infusion of cash following tax day. If you are responsible with your money and you know that you will save it or invest it, you can certainly try to pay what you owe and only what you owe, but I love knowing that I will receive a refund each year.

Use a Change Jar: I hate to carry change, so it is very easy for me to toss all of my coinage into a jar at the end of each day. I have been doing this for years, probably from about the age of ten, and it is always a fun afternoon for me when I roll my coins and see how much I have saved. Usually I find that I have “saved” about $500 every six months. Admittedly, “accumulated” may be a better term than “saved” but it is money that I have taken out of circulation and thus cannot spend!

Leave Your ATM Card and Cash at Home: I have mostly gone without an ATM card or cash for the past 3 months. When I am out and about, I rarely have cash in my pocket. As a result, I cannot buy anything unless the seller takes credit cards. I was surprised to realize how many places I go that will not take credit cards! At our local baseball park, the concession stand will not accept credit cards so if I forget to bring a cooler with water, I cannot have a drink. The water that I pack costs anywhere from 12 cents to 20 cents per bottle. At the concession stand it is $1 per bottle. On a hot day, that $1 would not seem like a lot, but by not carrying cash, I am forced to plan ahead and bring 36 cents worth of bottled water rather than spend $3 on it! That is the same as saving $2.64, which might not seem like a lot, until you average that over the 6 nights a week that my sons play ball.

Use Direct Deposit: If your paycheck does not have to pass through your hands, you are much less likely to cash it or to deposit it with cash back. It is a simple process but one that can help you to avoid adding unneeded spending money to your wallet every pay period.
Pay Down Your Mortgage. Chances are good that you pay higher interest on your mortgage than you get on money you leave in the bank. That means that by paying down your mortgage you get a better return than by leaving your money in the bank. If you have sufficient emergency funds in the bank, contact your mortgage holder and find out if you can switch to twice monthly payments, or just include extra money in each payment and indicate that the excess should be applied to the principle on your loan.

How do you force yourself to save? Do you have any tricks for increasing your net worth by not spending or by spending down debt?

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8 Responses to Six Ways to Force Yourself to Save

  1. Dana says:

    Some work places also directly deposit a portion of your salary into a retirement saving account. Automation saves you the energy to do it yourself. What’s not there, you cannot spend.

  2. While perhaps too obvious, automation is the key for most prospective savers. Since you can’t spend what you don’t seem, any amount that is automatically deducted from your paycheck or checking account (e.g., 401(k) contributions, IRA contributions) tends to be relatively painless. Double-bonus: you’re automatically paying yourself first.

  3. Carl says:

    Dave I like the ant and grasshopper story about your sons. These simple ways of saving are great words of advice and have merit. When your spending dollars it’s real money and not just numbers.

  4. Ann says:

    LOL The places I go take credit cards, so I leave them at home and carry just $10 with me or whatever I figure I need for whatever I’m purchasing. :-) Works for me.

    I do a lot of buying on-line and, as a result, get a lot of ads in my emails. I delete them without looking at them unless the banner says some big discount on everything and I’m currently thinking about purchasing something from that outlet. Then, I check it out, check out pricing elsewhere and still think about it before I purchase.

    By the time I left corporate I had two very small mortgages on my two homes because I had been paying extra principle for years. That’s part of the reason it was so easy to pay them both off when I sold the one I no longer wanted for my new life. Plus, it saves you a boatload of interest over the life of the mortgage.

    Automation is definitely a key. Frequently you can split some into savings, some into investing, etc., etc. like others have said.

    I used to have excess come out for taxes, but a word of warning is necessary here. Some states are in a lot of trouble and, I believe, California is considering (if they haven’t done it already) simply handing out i.o.u.’s, so I wouldn’t recommend paying any extra into any state right now. When I received my tax refunds, they automatically went into cd’s or investments or paid for a major purchase I’d been planning on.

    Believe it or not, it’s not such a bad idea to have a “Christmas savings club” account. Putting a bit in every week or whatever and then holding to that for your Christmas spending can do a lot towards not running up those credit cards at Christmas and being shocked when the bills come in in January.

  5. Svetik says:

    I use direct deposit into different checking accounts. This way I have no choice but to only spend lets say 150 and 60 in the other and the rest — unaccessible. It works wonders if I overspend – I can go without my other need or risk overdraftingmy account. But I also believe in checking account cushions. My 0 is 100.00 . Fees to me is like pulling teeth. ATM use is rare. I also have been known to cut cards to not access my money.

  6. Diane says:

    For automatic savings – You can set up a savings account at with an automatic savings deposit when linked to your checking account.

    It’s only paying 1.49% now, but you can use it to get money into savings and later use it to buy cd’s, or whatever you decide.

    You can even set up sub-accounts for different purposes – Christmas, new car fund, etc.

    ING also has cds available, but again, the rates aren’t great right now. I’m using the savings rather than lock my money in at a low rate.

  7. Beth says:

    This article was a good one because it made me think about how my kids approach the concept of saving. They each have savings accounts that they contribute to with birthday money. We talk about watching what we are spending and the value of money, however, what we haven’t done is sit down and talk about what saving is all about, if we put so much away each month, etc. I also think if we (as parents) model “saving” behavior – it will make a great impression right now – since they are 8 and 10 years old.

  8. Persephone says:

    I have authorized my mortgage lender to deduct an additional sum from my bank account each month to apply towards principal.

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