killing_rose: Raven/corvid in the frozen surf (Default)
[personal profile] killing_rose posting in [community profile] actyourwage
So I'm decent at putting an arbitrary number on my bank account and saying, "You don't get lower than [x]." But arbitrary is arbitrary and my saving hasn't been going as quickly as I want.

Since I know that once I have a savings account to funnel into, I can build it quickly, I went and opened a savings account at my bank today. My plan is to start with 200.

Next paycheck, add 150. Increase by at least 50 dollars each paycheck, until either a) I decide I want to cap it, or b) I suddenly realize I've deposited an entire paycheck in.

Helping this is the fact that my bank allows you to name a specific amount that you move from your checking account to your savings account each time you use your debit card. They allow up to 1 dollar. I set that as my specific point.

Of course, after 6 months of meaning to do this, it's the fact that I want to buy my new bedframe now, now, now that provided me with the impetus. With shipping and handling and the varying things I want customized, it's going to be 975. My savings account must be 1100 before I'll dip into it for the bed. I was originally aiming towards late fall before I'd buy it.

On my current plan, however, it's at max 5 paychecks away. And I get paid twice a month. July 15, I could buy my bed. My solid pine, lofted bed that will allow me to nest the way I want to.

Next goal: figure out what my first credit card is going to be. (Other than "something I can set a cap on." ) 

(no subject)

Date: 2013-05-02 12:13 am (UTC)
jamethiel: A majestic orange cat sits on a post in front of a beautiful green landscape. Text: I approve of this post (ApprovalCat)
From: [personal profile] jamethiel
The other thing I'd suggest is an emergency fund of at first an arbitrary (say $1000), and then aim for three months expenses in savings. Make sure you don't touch your emergency fund. It's not for savings, it's for things like "My car has blown up and I can't get to work without it" or "I've lost my job."

Beyond that, congrats on the bed!

Re: credit cards, you want one without a yearly fee, with the lowest interest. And never buy anything you don't have the money to pay off.

(no subject)

Date: 2013-05-02 05:08 am (UTC)
beatrice_otter: Babylon 5--Vir waving (Vir's wave)
From: [personal profile] beatrice_otter
First: Go you! The thing that gave you the impetus is less important than the fact that you actually went out and did it.

Re: credit cards. No monthly fee and a low interest rate are the most important thing; and remember that lots of cards have low introductory rates, but what you should pay most attention to is what the rate will be after the introductory period. One that pays rewards can be good, but the interest rate is more important. American Express tends to have better bonus/reward programs, but that's because they charge the vendors more per swipe, so it's more expensive for retailers to use, so fewer of them take it.

You do have to be disciplined about never, ever putting more money on it in a month than you can pay off that month. Unless it is a genuine, honest-to-God emergency. Never, ever just pay the minimum. Never. Even if you have an emergency that racks up more than you can pay off in a month, don't get by on the minimum to it. My credit card has a low interest rate and a great rewards program, but the minimum payment is the same ($20/month) no matter whether you have $100 on the card or $2,000. And the charming thing about that is that with higher balances, $20 a month isn't enough to cover the interest, let alone pay down the actual debt. I always pay off the card in full every month so it doesn't bite me, but I betcha there have been a lot of people trapped by that. Also, with a credit card it's easier to not realize how much you've spent at any one time. You have to keep an eye on it just like you would a debit card, if you don't want it to get away from you. (I say this from experience. Whenever I get complacent, my next month's bill is ... unpleasant.)

Re: savings. If you are single with no dependents, you can get by with a savings account that can cover three months worth of expenses. But obviously more savings is better, since it means that (for example) the next time you get a car you can put more money down, which means lower interest rates. Same with a house: the more money you can put down at closing, the lower the interest rates.


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