You Spend Some, You Save Some

Manage your money so you can save for when the unexpected happens.

Girl is putting a coin into a piggy bank that her father is holding showing that they are saving money. If you manage your money by having all of your income go to paying bills, you may be living above your means. Let me tell you why putting some money in a savings account is necessary and how I fit savings into my budget.

Why you need to budget for some savings.

When you’re making a budget for your life, remember that life is full of surprises. Hopefully you can presume what expenses you will have and your budget will cover all of those expenses.  If so, that’s great! Remember though, we know life is unexpected and often times our presumption, though close to accurate, means spending usually deviates a little from our plan. This is why we need to account for those deviations.  It might not seem as important when it is an unexpected birthday dinner for a close friend, but what about when that deviation is big?  Life happened and threw a big wrench in the plan. Let’s say your son comes home with a permission slip for a school trip, one week in El Salvador with his favorite teacher and all his friends are going. You only need to write a check for $600 and he can have a trip of a lifetime or a pebble hits your windshield and your insurance deductible is $500, now that $300 windshield comes out of your wallet. Good or bad, life happens and that is why we need to set up a savings account and budget for it every paycheck.

How I save because I am no fortune teller.

There are many ways to save money and everyone does it a little different. There is no exact number I can give you, some people try to put a specific dollar amount away every month.  For some of us who’s income varies, it might be easier to put away a percentage of our income.  Some people put away 20 percent but I like to put away 30, whatever you can manage. Now where to put your savings?  Like I said, there are many ways you can do this. If you don’t already have one, open a savings account.  This is a good place holder for your money. This way, you are able to separate it from the money that you have budgeted to spend. Your savings account is a good place to save for future goals and unexpected expenses, vacations, shopping sprees, putting a down payment on a home, or that windshield. Always keep some of your money in a savings account so if you need it, that money is available right away.  But, a savings account is not the only place to manage your savings. You can invest some of this money, start a retirement fund or invest in the stock market. There are a few different retirement funds.  Find one that looks desirable to you and start saving for your future, because getting old is a big example of life happening. There are many different ways to save for retirement.  Some to look into are: an IRA account, Roth IRA account, or a pension through your company. Put a little money into the stock market. This can be a fun way to invest your money.  Pick something that you trust, a company that you use and believe is going to keep flourishing and making money. You don’t have to put the whole 30 percent there but take 30 percent of your savings and invest it. The best part about this is you can turn that money into more money.  Who doesn’t like the sound of that? Watching the money you invest grow is super fun, if you are losing money you can always move that money around, and you can never lose more than you put in. Having savings in your budget is necessary because no one knows what the future may hold. So if you are not already saving or you read this and you might not be saving enough, sit down to do some money management and next time you get a paycheck put something away for the unexpected. Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual accounting, providing services to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks file and critical financial documents in an efficient and secure environment. Complete Controller’s team of  US based accounting professionals are certified QuickBooksTMProAdvisor’s providing bookkeeping and controller services including training, full or partial-service bookkeeping, cash-flow management, budgeting and forecasting, vendor and receivables management, process and controls advisement, and customized reporting. Offering flat rate pricing, Complete Controller is the most cost effective expert accounting solution for business, family office, trusts, and households of any size or complexity.