Savings over Spending

Hi y’all,

In case you don’t know, I am trying super hard to save money. I recently went to a Financial Literacy seminar held by a sustainer of the Junior League. While this particular seminar focused more on purchasing stock in companies that were “sustainable”.

At the end of December, I sat down and made myself a monthly budget for 2020.

In Charlottesville it is super expensive to live. The average cost of an apartment is about $1500 a month, without utilities or anything included. I’m single and teacher meaning that I have to really watch my monthly income (I only get paid once a month). I also know I’m a shopaholic. I’m working on it, though!

In order to make a slightly realistic budget, I sat down and looked at my “must have” expenses. The ones I have to pay each month. For me, this is gas since I’m super lucky to have the living situation I have.

In order to start my budget, I split my monthly salary in half. This is what will go immediately into savings.

I also know I have to pay for grad school every semester. I have no financial aid, no scholarships, or grants. If I save $800 a month, I’ll be able to pay for each semester in full. This is about a quarter of my salary, or half of what is left after I split my salary for savings.

The only major expense I have every month is gas, which is about $120 a month. I have to get gas at least once a week. In the winter, it is sometimes more since fuel tends to be more expensive and I use more in the colder weather.

Whatever is left over is what I can spend guilt free, of course it is better not to spend this money, but at the end of the day, I know I cannot only limit myself or my spending will get out of control.

One thing I did for myself in 2018 was start a high yield savings account through Ally Bank. This allows me to have an interest percentage over 20 times the national average. In my regular bank account, I get about 3 cents a year in interest compared to almost $30 a month with Ally!

I started to use the Mint app to help track my budget and spending more efficiently a few days ago. It’s already way better than it used to be. I was able to create a “goal” in the app which will allow me to see how I’m working toward my goal of owning a house and paying for grad school without loans.

To break it down, the easiest way I have found to save that is common sense is:

1. Divide your monthly salary in half.
2. One half goes to your savings account. This is money you cannot touch.
3. The other half is divided into what you need to spend money on, or extra savings. I split this in half, and half goes to my education fund, leaving me with a quarter of my monthly salary to spend every month.

If you have student loans, I would figure out how much you need to pay on your student loans, and then divide in half from there. Obviously, it depends on your living situation as well.

What have you found that is useful for saving money?


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