Ethan and I have a heck of a time saving money. We make substantially more money than we did 6 or 7 years ago.....and have nothing to show for it. The more we make, the more we blow on junk. Really not sure where--spendier food at the grocery store?? More crap in the house that we dont use?? Just junk.
We recently discovered a program that takes our suckiness and makes us save. It is called smartypig.com Dumbest name ever, but it is a good idea.
Basically, we tell it what we want to save money for (for example, our 2010 Seahawks season tickets), and when we want to have all that money saved by (we need it by March 15 of 2010). Smartypig figures out how much we need to save each month to meet our goal, and automatically removes a monthly amount from our bank account (evenly divided amounts taken out once monthly). It puts this money into a savings account that earns 3.1% interest, so we will end up with a little extra (much more than the 0.6% interest in our regular savings account). When we meet our goal, we have the option of having the money transferred back into our savings account (free of charge), or we can apply the money to a gift card from a variety of stores (best Buy, etc). If we choose a gift card, they give you a little extra (up to 6% more money), as an incentive.
We have set up accounts for our Seahawks tickets, Storm season tickets, the GEICO bill that comes twice a year, and a vacation fund for cash/incidentals on vacation (not for airfare or hotel fees). This way, we don't have months where we are totally broke because we had a several hundred dollar insurance bill or our $1000+ Seahawk tickets due. It evens things out over the whole year (or whatever time period we specify). Great service. I am thinking of adding in the Amerson portion of the Coast Christmas house rental as well....
Check it out! 3.1% interest is quite comparable to what you would earn in a CD, but you can access this money ANY TIME. You can increase or decrease your goal amounts, take money out early or late, etc. A great way to do things. Really takes the responsibility of saving money out of your hands if you suck at saving, like we do.
Another financial decision we have recently made (well, a few months ago), was to open up Roth IRAs for both Ethan and I. You put money into these just like a 401K or 403b...but this money comes out of your bank account AFTER you have already paid income tax on it. You can put a max of I think $5500 per year into your Roth IRA, and it is only available for people making less than $150K per year. The beauty of this is--the money/earnings are TAX FREE when you take them out at retirement (unlike 401k/403b, where you must pay ordinary income taxes on the money you take out). A Roth IRA is a great supplement for retirement. If you average it out, the max you can put in per month is about $415 (unless you are over 55).
The great thing about the economy today is that I am young enogh to be around when things recover. Stocks are so low, I can buy them now for cheap. For example, a stock that is generally around $20 per share is now around $4 per share.....I can afford a lot more shares if I buy now. The prices WILL go up over the next 25-30 years before I retire....so I am getting a lot more shares of stock than I ever would have been able to afford before. It is important to be very diversified in your investments, so that if some stocks do very poorly, you have enough different ones that some will also be doing well, so you don't lose all your money.
We watch a lot of Suze Orman and On the Money and Mad Money and Dave Ramsey (when he is not on a religious or political rant). Learning a lot, and feeling pretty good about retirement someday.....