Friday, February 02, 2007

Saving Graces

I saw a very odd advertisement last week. It returned the phrase “Saving Money” back to what it actually means.

As a culture we are used to the ads that promise that we will save money. In reality spending money is the opposite of saving money. You can buy a sale item and the cashier will tell you that you saved $10 by shopping there. Ever use a club card at Safeway? At the end of the transaction they say “Thank you Mr. or Ms. whateveryournameis, you saved $7.59.” Not at all true; you’ve spent $75. 98 on stuff that should have cost you $50, and even if you had only spent $50 you still spent it, not saved it. They should tell you that your purchase was discounted by 10%.

Saving means to take the money and not only, not spend it, but to put it away so it won’t be saved. Put it in the bank or burry it out back. That is what saving is all about. If the money is in your pocket it isn’t being saved. That money is ready to go.

If the Save the Whales or Save the Rain Forest projects prevented the death of only 10% it would not be a saving at all. It would be a disaster. By thinking that you are saving on a sales price, you may be headed for economic disaster because.

So about the commercial I mentioned earlier. It talked about taking the money that you would spend one day each week and sticking it into a savings account. What a brilliant idea. Average your weekly spending and sock away one seventh of it.

It isn’t rocket science, but in a way it is. This generation isn’t on the whole, very good with saving. Most people are in thousands of dollars of credit card debt. They are living hand to mouth, pay check to pay check. They don’t save and further more they can’t save. If people could start small with 1/7 of their net pay going into savings, in seven years they will have saved one year in wages.

The children of the depression understood this, but their children and their grand children have no concept of saving. When the generation that saves are all gone, their savings will go to spenders. Our nation will be in dire straits economically when the nations that lend us money call in their chips.


Blogger Beth said...

Oh, my god, you are so right. I can't believe the number of people I know who are in debt.
Our kids all received credit cards once they were in university and were taught - always pay off the balance by the due date - NEVER, NEVER end up having to pay the interest. And they GET IT! (Of course, we're not talking thousands of dollars here, but still...)
Kids learn by example. Parents have a tremendous responsibility in this realm as well. You want something? Save your money so you can afford to buy it.
(Rant over.)

6:15 AM  
Blogger Jeff said...

I'm curious if they teach financial planning in high school these days. I can't imagine a more appropriate venue for teaching money management than to those on the verge of becoming so-called independent.

6:38 AM  
Anonymous Anonymous said...

I have found the only way I can save money is to send in an extra 50.00 automatic out of my checking towards my mortgage payment each month, what a difference. I make it a point to show my kids the statement each month.
Your a good writer Guy.

8:26 AM  
Blogger Donna said...

It's just too easy to get credit, and before you know it, you've fallen into the trap, destined to a life of making payments.

8:29 AM  
Anonymous THartill said...

I just read somewhere that the U.S. savings rate is the lowest it's been in 75 years. Something like -2%!


8:50 AM  
Blogger The Guy Who Writes This said...

Tryan, the figure for last year was people spent 1% more than they made. This is a disaster. They are spending the equity of their homes as well. There will be a great divide over the next twenty years or so when people retire. Actually few will be able to retire.

Good idea, Anonymous on spending down your mortgage. That extra $600 per year will get you paid off years ahead of your target. I do the same thing.

Any educators out there? Is it being taught in schools?

Payday loans are the worst thing to come down the pike since credit card were invented. MAybe it's time to reinstitute usuary laws.

9:18 AM  
Anonymous THartill said...

There was a class that was required for all freshmen at AHS that was exactly what you are referring to. But that was 13+ years ago. So...

I agree about payday loans...but what about bank overdraft fees, they are much worse, but no politico's seem to care. Of cause I would hate to mess with the Bank Lobby. Much easier to mess with Payday lenders and gives the opportunity for local political critters to say "look at me I'm doing something!"

9:39 AM  
Blogger The Guy Who Writes This said...

It's odd that people take the time to understand their cell phone plans, but have no idea about services their banks provide. There are services such as overdraft protection and or lines of credit which work as overdraft protection. These services are usually available after you've had an account for a couple months and not to new accounts. Having a line of credit not only protects you from bouncing a check, but it also helps your credit rating because your rating will nolonger get dinged from over drafts and having the extra good credit will boost you as well.

10:00 AM  
Anonymous THartill said...

Yeah but the people that overdraft a lot mean they can't manage their money. These are the last people you want to give a line of credit to. They will max out the credit line right away. Then what happens? The person can't pay it back and skip out on the account and are forced to go to payday/car title lenders.

10:14 AM  
Blogger Boo7 said...

Yikes yes those pay-day loans are work of the are the deferred payments that just about EVERY big box store is now your entire house worth of furniture and electronic equipment and don't pay for 12-24 months....what an absolute scary, nightmarish thing that is....generally the saying...if it's too good to be usually is!!

1:24 PM  
Blogger Jaggy said...

I graduated five years ago, and my sister two years ago, and we both had to take both Economics and Personal Finance as seniors. We learned how to balance checkbooks. We learned what kinds of credit cards are bad, how to use credit, and what it's original purpose was. I can't say I pay off my statement every month, but I do most of the time. I dump $100 of my net paycheck into savings, but sometimes I have to use savings... at least it's there and I'm not putting things on a credit card or overdrawing, right? A bigger problem, I think, for this society anyway, is learning to be happy with what we have and not running out to buy the newest or biggest thing.

2:04 PM  
Blogger The Guy Who Writes This said...

Tryan, some will abuse it, but it is a tool for those with discipline.

Boo, add Rent-A-Centers to the list as well.

Well said, Jaggy. Consumerism is the root of all modern evils. Dancing doesn't cost much, so beware of the costumes. BTW you and your boyfriend are adorable as Sims.

2:18 PM  
Blogger Mom of Three said...

Credit companies are the new loan sharks. We, after years and years and years of NO credit cards, finally got one for Lowe's and one for HD, because things in this house can blow up at a moment's notice. But when we were young, Slave Hubby and I Big the Big Credit Booger, and since then, we know now how they can trap you before you know what's hit you and then you're done.

Savings? God, I wish. I value the concept, don't get me wrong. But at the end of the food bills and the gas bills, etc., there just doesn't seem to be much left over...I'm always trying to work harder on that concept, though.

4:03 PM  
Blogger Mom of Three said...

Make that "Bit the Big Credit Booger."

And we also pay extra on the mortgage, fastest way to make a differnce!

4:04 PM  
Anonymous THartill said...


(Or Shameless Web Ad)
NCO Blogentine contest

Easy to play easy to win....

7:10 PM  
Anonymous Moosehead said...

Re photo - Still sucking up to become a Canadian eh? God Save the Queen!

4:40 AM  
Blogger The Guy Who Writes This said...

Mo3, you will be able to add income when your kids are grown. It's amazing how minimal your purchasing becomes when the kids move out.

Moosehead, any chance I get, besides I couldn't resist with the favorable exchange rate.
Good day, eh...

5:18 AM  

Post a Comment

<< Home