Let’s chat savings, shall we? When Dane and I first got married we had about 792584 different savings accounts – his, mine, ours, IRAs, CDs, Christmas club accounts, rainy day funds. It was getting really confusing! One of the very first “married tasks” I did was streamline our finances. My mom is a financial professional, so I get it honestly I think 😉 I’ve touched a little bit on the topic of savings before (How We Budget), but when I shared the post about how we save over $550/month, I got quite a few questions and lots of interest in more money saving blog posts. Your wish, my command. One of the biggest questions I got was in reference to something I talked about when Dane was transitioning out of the military – how we padded our savings account. You can read the entire FAQ post about Dane leaving active duty Army here, but today I’m going to explore how we took the year prior to him leaving his job with Army to save, save, save. Specifically, how we doubled our savings account in one year.
How We Doubled Our Savings Account In One Year
The first thing I want to cover is our why. For some people the why factor might be to get out of some kind of debt, or to save more to buy a house, or pay off student loans or heck – maybe just to challenge yourself! Our why was that Dane was leaving active duty military service and we really weren’t sure of what the future held. He wasn’t sure how soon he was going to be getting a civilian job and what it might pay (maybe higher or lower than he was earning in the Army) – there were a lot of unknowns! We had heard stories about transitioning soldiers who didn’t start their civilian jobs right away and needed to live off their savings account. It’s a perfectly normal situation! That said, we didn’t want our account to take a huge hit, so starting 12 months out, we started calculating changes we needed to make.
The first step was figuring out what money was coming in and where it was going. We did this by assessing and scrutinizing every credit card and bank statement we had. What was our total income each month? What expenses did we have? What were our projected monthly expenses? This was crucial for us, because I’ll be totally frank – you might be totally shocked by how much money you have coming in and then POOF! It’s gone. Where the heck does it go? Making sure you know and understand your cash flow is SO IMPORTANT so I cannot stress that enough. We used a spreadsheet to track all of it and our categories (for anyone who may need help) were as follows:
Entertainment (movies, mini golf, etc)
Internet (If you have cable/satellite – add that one in here!)
Beauty (this includes Dane’s regular haircuts + any beauty/skin products I purchase)
Once we knew where all of our money was going and what we, theoretically, should have leftover, it was easier to see what we could easily cut out. The things that went away immediately were frivolous expenditures like dinners out, Redbox, coffee dates, movie dates and shopping sprees. Let’s be honest – we don’t need any of those things. I also stopped buying expensive makeup (my face didn’t melt off or implode) and we meal planned the heck out of our food so we didn’t overspend at the grocery store (easy to do). Essentially – we took our spending down to the bare bones. Next, we took a look at ATM cash withdrawals – were we taking cash out of the ATM that didn’t serve a specific purpose? It’s hard to track where those dollars are being spent, so we stopped doing it to get a better handle on exactly where the money was going.
Once we knew our bank account in and out, we made a plan. And let me just preface this with – I’m not a financial advisor. What worked for us may not be feasible for everyone, but hopefully you find a few of these actionable steps useful. Once we had all of our fixed numbers, we made the decision to live entirely off one paycheck per month. This was made easy, in part, thanks to the military’s housing allowance, so our rent was covered, but we still needed to manage the rest of our expenses. A quick peek at the list above shows you that was no small feat, but I am living proof that it’s doable and I’ll even go further out onto a limb and say that if we can do it, so can you. We also lived by the mantra “It’s only a good deal if you need it.” At the end of each month if we had anything left over, that all went into savings. It almost became a game to watch our account grow! By the time Dane was getting his last active duty paycheck, we had doubled our savings account.
And maybe this is the part where I admit that talking about budgeting makes me geek out a little bit…No but honestly – I love trying to figure out ways to save money and budgeting challenges. I wanted to share how we did it not to be boastful (believe me – we like to spend like everyone else and have our own unique income challenges), but to inspire anyone who might be reading that wants to save a little (or a lot) of money and/or simply wants to take hold of their finances. It can be majorly intimidating when you’re trying to navigate a budgeting plan and I know this, because I was there! So, if you read all the way through this – bless you – but I hope you found it useful.
Now let’s talk – do you have a budget? How do you save money? What are your thoughts on credit cards? And maybe more importantly – do you like these budgeting posts?
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