Saving is self care

Forty-seven percent of Americans “can’t pay for an unexpected $400 expense through savings or credit cards, without selling something or borrowing money.” – Hunter Schwarz on June 8 in a Washington Post article

Don’t worry if you’re in that number. Just start where you are. Saving is particularly important for women for several reasons. Women are often concentrated in lower paying jobs, which means lower overall lifetime earnings. Also, women frequently live longer than men and can be financially vulnerable in cases of separation or death. That is especially true when children are involved. Ultimately, having money in the bank contributes to a feeling of security and peace of mind. Here are some ideas to try.

Keep a piggybank

Many years ago I helped my mother roll up $25 worth of pennies. She used the money to open her first account separate from my father. She still has that account today.

Consider your company 401k plan

When you contribute $25 of your pre tax earnings you reduce your tax base and you may even be eligible for company matching – free money. Even better, pre-tax contributions mean you save $25 but your paycheck is only about $20 less. It doesn’t matter that you aren’t saving as much as you want to save. It only matters that you start saving. You can increase your savings as your budget allows.

Consider an incremental purchase plan.

Maybe you don’t have enough to buy a share of Apple or Google. An incremental purchase plan allows you to purchase portions of shares. So if you can invest $25 you can start purchasing stock without a lot of cash. Providers such as Sharebuilder also offer automatic dividend reinvestment and automatic deductions. Easy breezy.

Set a small savings goal

Your goal need not be big. Just make one, such as $5 or $10 per month. Save the money through automatic deduction in an account you do not have regular access to. If your budget is just too tight to allow any saving, sell something you are no longer using. Consider a yard sale, eBay or Tradesy. Tradesy users can upload photos of clothing items they want to sell. When the item sells, transfer the money from your PayPal to your savings account.

Remember, you can’t buy your way out of pain or disappointment, so don’t try. The debts will likely make you feel worse. Tune in tomorrow for alternatives to spending.