Savings are for stupid-heads

October 13, 2009 · 5 comments

Sorry I seemed to drop of the face of the earth the last couple days, but I’ve quickly learned after living on an island no bigger than a Super Wal-Mart, the internet here is quite unreliable. I’m glad to be up and running today, so hopefully I will be able to post regularly. Now on to bigger and better things.

Don’t get confused by my title debt punchers, I love saving money. In fact everyone should save. I’m a huge fan of my online savings, account. Actually, that’s not completely true. I was a huge fan until Bank of America took over my Countrywide account. Once I return stateside, I plan to convert to the ING cult.

As important as I think my savings account is, I’m not gonna lie, it’s only my second most favorite way to pay for things. My all time favorite way to pay for future expenses is cash flow.

I may have money in the bank, but I hate spending it. In fact, I haven’t withdrawn one cent from my savings account in the two years I’ve had it (except for some early Roth IRA contributions). Virtually all expenses can be anticipated, and as I anticipate them, I figure out ways to use my income to afford them. This keeps me from dipping in to my savings. Take for example the digital camera, I blogged about recently. I’ve wanted it for a while and have more than enough cash in the bank to afford the purchase, but when I finally decide on the camera I want, you wont see my savings account drop a penny. Instead, I’ll set aside a couple hundred dollars over two or so months of paychecks until I reach the purchase amount. Then, I roll up to the Best Buy like a true gangsta and say “Give me my camera…please.”

There are a couple benefits to using the cash-flow system for small to medium expenses. First, your savings account is truly a savings account (not some quasi-savings/quasi-spending thingy). Second, it limits buyers remorse and impulse buying. If I set up a cash-flow system, then I am forced to wait on the purchase at least until my next paycheck. Lastly, it makes you sound really cool when people ask if you want to finance your purchase and you say “Hell no, I’m cash flowin’ this biotch.”

Do you all work the cash flow system in to your medium sized purchases? Do you regularly dip in to your savings account, for non-emergency items? Did you miss me these last four days? Lord knows, I barely survived without you all.

{ 5 comments }

1 Jessie

I'm a big fan of saving up and buying later. Make a plan. Plus, by the time you buy it – the price will have probably gone down then if you had financed it some other way.

That's the ideal situation, sometimes your faced with a bump on the road (reference to Gail's post today) and you've just go to buckle down and buy what you buy – but in best case scenarios… save up and buy later.

and yes, i missed ya ;)

2 RainyDaySaver

I don't touch my savings cushion. It's all about cash flow. And right now, cash flow is paying off what's left of our CC debt. If there's a big purchase to be made, cash flow will take care of that.

3 Foxie | CarsxGirl

Sorry Ninja, I don't stop by frequently enough to miss you, I never noticed you were gone. ;)

I totally do the same thing. Most of the time. What I *love* about savings is being able to jump on a good deal without having to wait to generate the cash, mostly because the great deal would be gone by then. Latest examples: Crazy marked down dress for friend's wedding and, best of all, the set of wheels my husband's wanted for his car.

Those wheels were a set a guy was selling for $500, nearly scratch-less (I think there's one total) with decent tires. It wasn't feasible to wait until I got paid again, we had to take immediate action. (The wheels alone would be nearly $1200 before tires.) So my savings account came to the rescue, and I'm planning on paying it back ASAP. I've also finished my husband's birthday shopping in one fell swoop, with something he loves. A whole month early. :) Wouldn't have been possible had I not used savings, even though it wasn't my favorite thing to do. I know what my extra paycheck's going towards now!!

4 Joshua

You missing out sucka, I use a credit card with rewards points and pay the bill in full every month. Basiclly I don't pay any intrest or fee's of any kind. I build and get credit which helps my score on a reocurring basics and I get free shit that as best I can figure out is TOTALLY free. I know my dad told me there was no free shit in life but it appears that there really is because some other moron that is running a balance and paying interest is paying for my free stuff! Right now I am using a Citi Premier Pass elite level World Elite card. This gives me at least 1 point for ever dollar spent and 1 point for ever mile I fly for work (maybe helpfull to you) generally it's about 10,000+ points for a $100 gift card. In the end that appears to be the best option for free stuff. I use the card for everything and then use my cash flow to pay it off in full at the end of the month. This is what works best for me you should check it out!

5 Jesse

You were gone? ;) jk, and I agree with everything you said here except the Best Buy part. I used to work there and can never shop there for anything over a dollar..such a ripoff man, get your Camera at newegg.com or some small mom and pop store that will at least give you really good service when you overpay

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