Confession time: I have a tendency to be an impulse spender. I’ve always been that way. In the past, it’s been buy now, consider the purchase later. And I’ll fully admit that in my early 20’s, it got kind of out of control. I was so busy trying to “keep up with the Joneses” so to speak that I didn’t really thing much about the fact that I was so far from finding ways to master my finances and was instead putting myself further and further behind. All that mattered was having that new Louis Vuitton purse, those Jimmy Choo shoes and presenting myself in the way that I wanted to.
Then, things changed. I got married. Started a family. Bought a house. And all of a sudden, the instant gratification I had spent my early 20’s seeking didn’t matter quite so much. Worries about carrying the right handbag were replaced by worries about college funds, savings accounts and paying off my mortgage with plenty of time left to enjoy my life. Suddenly, what I wore took a lesser priority than what I was saving to give my family the future I had always envisioned. And so, right then and there I began a quest to change the way I looked at money and instead of letting it rule my thoughts, I made it my mission to master my finances and prepare for the future I never knew I always wanted.
Set up a Savings Account
After getting married, the first thing my husband and I did was set up a savings account. Why you ask? Because when you suddenly find yourself with a family to provide for, you want to make sure that no matter what happens, you’re prepared. Way back when I was a finance major in college, I heard my professors of my personal finance classes talk about an emergency savings fund time and time again. They all recommended having at least six months worth of expenses set aside just in case there ever was an emergency. So that was where we started.
But once we had our emergency fund, we realized that if we wanted to plan special trips, purchase new items for our home or even deal with cars breaking down and aging, we needed additional funds. And while we didn’t separate them all out into their own funds, we did put together a place where we can save towards beach trips…
and other items that are on our wish list.
Make the Most of Your Mortgage
Once we had put our savings plan into action, it was time to take a look at our mortgage. After speaking to several advisors and researching our options through sites like Bankrate, we decided that a 30-year fixed rate mortgage was the best option for us. We knew we wanted to own instead of rent so that we were building equity in our home. But we also knew that we needed to make sure we had a mortgage we could afford on a property we loved.
After looking into interest rates, payments and terms, we were able to choose the best mortgage that allowed us to get exactly what we wanted while still having money to pay our other bills and build up our savings account so that we could purchase things we needed for our beautiful home…like new porch furniture!
Plan Your Purchases
Speaking of that new porch furniture, the next stop to help master our finances was thinking about the way that we use our buying power. Now, I’m not saying we never buy anything new. Not even close. But we’re now smarter about the way that we buy it. We look into interest free plans and we make sure we have the savings to afford our purchases.
If at all possible, we try to wait to buy items until we can pay for them in cash. And if that’s not possible we try to find the best financing deals and ensure that the payments fit comfortably into our monthly budget. We take into account if an items is a necessity or a splurge and then we make smart decisions based on that information. This way, we don’t end up making those hasty purchases from my youth that aren’t really that important and simply leave us having to cut into our savings from other areas.
Think About Retirement
With our savings and mortgage firmly in place, I thought we were doing pretty good. And honestly, we were. But then I realized that one day, the hubby and I are going to want to retire (preferably to a little bungalow on the beach). Back to my research I went to determine what percentage of our monthly income needed to go into retirement funds and what the best plan of action for me was since I’m self employed. I crunched numbers, looked at data and answered questions. But nothing made it easier than a simple retirement calculator from Bankrate that easily showed me the impact that what I’m saving today will have on my future.
I’ll admit that at first, seeing those figures was scary. But after thinking about the fact that retirement is probably one of the most important things we can be saving for (we don’t want to work forever after all), I achieved peace of mind knowing that the numbers don’t lie and Bankrate helps me plan smarter!
While I could go on and on about the importance of building savings and mastering finances, for my family these four tips encompass our financial goals and allow us to live comfortably while saving for (and enjoying) the things that we want both now and in the future. Whether thinking about college for the kids or how we will travel the world once they both head off to their own lives, all of our plans can be met by mastering these four simple tips and learning more about how to save for the present and the future that we want!
So I challenge you today. Take a look at your finances. Examine your emergency savings account. Think about how you want to live in the future. Then use the amazing tools from Bankrate to ensure that you don’t put off till tomorrow the changes that you could be making today! That way, whether it’s that once in a lifetime trip or a much needed new car or even the dream or retiring to a bungalow on the beach, you’ll be able to rest assured that you’re well on your way to the financially secure future you’ve always dreamed of!
Tell me, what are you saving for and how are you making your dreams a reality?
This is a sponsored conversation written by me on behalf of Bankrate.