Organization is the Key to Saving

The biggest, and sneakiest, impediment to success is lack of organization. Saving money is no exception. Trust me, saving money requires an actual system because it can get hairy out there!

Last time I talked about my financial awakening, so to speak. I’d come to realize that the CD that held $20,000 in my bank was not earning a decent amount of money ( at .25% it was almost laughable. Imagine making a quarter for every $100 at year end!) and I decided to take it out of that account and temporarily put it into my checking account.

The part I failed to mention was that the moment I got into my car and left the bank parking lot I started to worry.

It didn’t help that while I was in the bank, another teller had casually sidled up and asked what I was planning to do with the money. Was I going to buy a car or something big? Later I realized she was probably going to offer me a loan—good thinking on her part! But, when I told her I was putting it in the stock market, she completely balked. She looked at me with an expression of poor horror, as if I was making the mistake of my life, and without hesitation said that the bank was FDIC insured, while the stock market was not.

Nevertheless, I was pretty confident with my decision. After all, I’d been reading about investing and finances pretty religiously for over a year. I knew one thing for a fact: wealthy people did not have large chunks of money in abysmally low savings accounts.

But, as I was driving off, seeds of doubt took hold. I had a vague notion of how I was going to handle my savings, but I wasn’t exactly sure what the ”details” were. I have a savings account in an online bank that currently offers 2% (Synchrony Bank)—but I’d had one unsuccessful attempt at transferring money between accounts and so I didn’t feel that my skills were too sharp. Navigating that amount online just seemed unwieldy and frankly, scary.

I was so anxious that my agitation made me almost catatonic. It’s a wonder that I was able to drive home! I started to think that my hazy plans were totally stupid and that I’d slowly and ignorantly fritter away my only savings!

Basically, I was totally messing with my own head.

Or was I? The thing is, unless you have a clear outline and plan to increase your savings, you are less likely to actually save. I knew one thing about myself: I had to separate the money that I used for items such as groceries and gas from my emergency fund. If I didn’t separate the money I would have no real incentive to add to my savings.

Over the years I have had numerous monthly expenses, from cable at $60.00 per month to gymnastics for my kids at nearly $300.00 per month. When the time came to reassess those activities, I always thought that I should save that money—after all, we had been paying that to someone for months, even years, and never been late or unable to pay. But, somehow, despite the best of intentions, I’ve never been able to pay myself.

I vowed this time would be different. This time, I would actually follow through. What worked in my favor was that large amount from the CD. That provided the impetus to actually make a ‘move.’

My next move, learning how to transfer funds between accounts would prove to be of key importance in helping me stick to my guns and build up my savings.

Why it’s Important that Your Money makes Money

One of the most important financial lessons I’ve learned thus far is that allowing your money to sit idle is the absolute worst mistake you can make. The reason for this can be summed up in one single word: inflation.

Inflation is the inevitable process where prices continue to rise, while the value of the dollar becomes less.

According to, the average price of a new car in 1970 was just over $3,500.00. A gallon of gas was 36 cents. (Shocking, right!)

While your dollar is shrinking almost across the board, it’s important to fight against inflation by keeping your money in accounts that actually earn interest.

I learned this the hard way when I realized that a good chunk of my own money—money I’d saved for years— was stuck in a CD that had a horrible interest rate. I’d kept this money in the CD, allowing it to continually reinvest. Each year I’d get a reminder letter —-something I should have read and paid attention to, and each year I missed the deadline to take it out and put it into something decent. I even had my kid’s money invested in them!

And then, one day, I WOKE UP.

I’ll be honest, it was really as if I’d just woken up—like Sleeping Beauty but Older and Less Beautiful. Definitely more tired and a little bit pissed, because I was making a 1/4 of a percent on my CD!

The amount was so low that when I walked into the bank and asked to take all of our CD’s out and put them into my checking account, the teller didn’t bat an eye, other than to say, ”well, when you take your money out early there is a fee, although the rate is so low, it’s not going to add up to much.”

You got that right.

The truth was, that I just didn’t really know that I was doing myself a grave disservice. I also did not realize how many years of this procrastination had accrued. My son was 12 by the time I figured out I’d been operating on autopilot for those years—12 years of missed opportunities to make money just by choosing wisely. I know, it’s embarrassing, but I finally did the math and I realized I was making about $50.00 a year on a CD with what I viewed as my life savings—$20,000!

(Just to give you an idea, I make almost $250.00 a year by just using a credit card that gives me points!)

The bummer was that I’d comforted myself with excuses like:

–”at least I can’t touch the money.” OR

—“I think a just saving in a bank is best anyway!”

On hindsight, I can see that those were excuses for my own laziness.

But there was something more behind this lethargy. If I really dig deep there was always a sense that trying to get a better rate seemed kind of greedy. I felt that I had enough and I felt unconsciously obligated to just take what I was getting without asking for more.

Demanding more, and even paying attention to what I was saving, seemed ungrateful on some level.

While I still have a long way to go, I now understand the foolishness of my ways. I can see now that just one major loss, one health problem, or an accident, could drive us into debt. While we are not currently in debt, we are not so far removed from the possibility.

When I finally decided to look at our finances, I realized we were coping month to month, living paycheck to paycheck, and doing this year after year. There was a tension in our home that I had ignored—a slow, energy-sucking tension that was caused by that feeling that if you stop, you’ll drown. When it dawned on me that we were allowing ourselves to accept this panicky way of living, I realized that something needed to change.

Next time I’ll talk about what my first steps were towards financial stability.

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