At the beginning of the year, we committed to having things be different in our lives for 2006.  This is the year we will get our financial house in order.  We have taken the blinders off and finally, we know where our money has been going in the past.  Were you surprised that you spent so much money on food?  Was it the clothes or perhaps it was the Starbucks coffee at $3.50 per cup?  Nevertheless, we are now focused and we can establish a viable plan of action.  I asked you before about your strategy to save.  Let’s explore that even more.  You’ve worked hard all week and now its payday.  How much money do you keep for yourself?  What do you do with that amount?  Well sometimes people will buy themselves something special, save for a vacation, get their hair cut or nails done, or allocate the money for a night on the town.

Saving for a rainy day isn’t often on our minds.  Don’t worry. You are not alone with that attitude.  For the last several years Americans on average saved 0.00%.  This represented the lowest level of savings in decades.  We have become a debt society.  But that attitude will not improve your financial picture.  So here are some questions you may want to ponder on before your next pay check.

If you lost your job tomorrow, how long could you maintain your standard of living?

If you suffered from an injury and was forced to stay home and nurse a disability, even for three months on 2/3rds of your income, can you survive?

As a homeowner can you afford for the hot water heater to give way, the roof to leak or the boiler to burst?

If you suffered from an auto accident, or your car needed repairs, can you afford the unanticipated expenses?

These are just several examples of unanticipated events.  Now, I want to share a story with you.  Even as a planner, saving didn’t come easily.  It takes discipline and a commitment to have my life be different.  When I first started out I realized that although my intentions were always to save money, every penny that hit my checking account needed to be used to survive.  So I decided to turn my “savings” into a bill.  First, I looked into options offered by my company to withdraw out of my check before the money ever hit my account.  That started my savings into my retirement plan.  Once that was complete, I looked at credit union options and institutions that were not easily accessible to retrieve the money.  Even today, I withdraw money from my clients’ accounts and they do not have ATM accessibility.  While the money is completely liquid, it is not immediately available to them.  Now that you know where your money is going, and how much you need each month to maintain your standard of living, the general rule is to have three months to six months of emergency cash set aside for the examples you see above.  I often encourage new beginners to start off small because this is an achievable goal.  Even if you commit to saving $20 per paycheck, you are setting a standard for yourself.  Don’t worry, the money will begin to grow and you will get excited about saving.  Before long, you will find yourself adding more than you originally committed to saving.  One additional way to get started is by asking your company if they match any retirement contributions you make.  For example, you can contribute 3% to your retirement plan to save for the future.  Your company has indicated any contributions you make for yourself, they will match either dollar for dollar or even 0.50 cents to every dollar you contribute up to a certain percentage.  Whatever the company has decided to match you, make sure you begin to save at least that amount.  The reason why is because immediately you are receiving a pay raise of that percentage, even if you can’t withdraw it until age 59 ½.  We will expound on that later.

You have just addressed two key areas of financial planning-establishing an emergency fund and saving for retirement.  You should be very proud of yourself.  Keep me posted on what your commitment is to yourself and don’t forget, if you have any questions, need additional direction; please don’t hesitate to contact me at  Until we speak again,

Be blessed!