financegirl on May 5th 2008 Saving
Back in 1999 - long before Bank of America’s Keep the Change program - my bank teller supervisor was filling us in on her sneaky snowflaking technique that worked much the same way.
For every check she wrote or debit card transaction she made, she would write the amount in her checkbook register as an even number. The change was “forgotten” - although she did write the actual dollar amounts to the left of her whole numbers so she could add up her savings and write it in the sidebar every once in a while. Then, after a few months, she would transfer the “extra” money to her savings account.
She saved hundreds of dollars per year doing this, and used her savings for gambling during her annual Vegas trip (remember, snowflaking can be used toward any goal, even one that Finance Girl does not explicitly approve of).
If you already have a Bank of America checking account, you should definitely sign up for the Keep the Change program, because you get a 100% match on your savings for the first three months, and a 5% match thereafter (for a maximum match of $250 per year). But if you don’t - hey, there’s always Debbie’s method.
(This post was an editor’s pick in the Carnival of Snowflaking, hosted by Antishay Ventenne.)
Photo Credit: Keep the Change by Tokenhippygirl, used under Creative Commons licensing
financegirl on Mar 25th 2008 Children
I have a nine-year-old stepson who receives an allowance of $9 every two weeks. Out of his $9, $2 goes to savings and $1 goes to the charity of his choice, leaving him $6. So, from his allowance, he is able to save $52 per year - not bad, but at that rate, he’ll be lucky to cover the cost of textbooks for one semester of college.
If you really want your children to get ahead financially and make saving automatic, you’ve got to set savings rules for their largest source of income: cash they receive from relatives. I would estimate that my stepson probably pulls in an amount equal to his allowance in cash gifts from relatives each year.
A few years ago, we started making him save half of this money. And by “save,” I don’t mean “I’m saving for a Game Boy.” It has to be for a long-term goal, such as buying a car or paying for college. Today, he has $583 in the bank.
It was a difficult transition for him at first, but it’s working better than I had hoped. He now voluntarily saves half of all non-allowance money he receives. When I asked him this morning what he plans to buy with his proceeds from our upcoming garage sale, he replied, “Well, I’m going to save half of it, and buy something with the rest.” I was fully expecting him to say “video games.”
We plan to continue this requirement through high school, and also make him save half of any money he earns from part-time jobs.
What are your thoughts on this? Do you think it will make it easier for him to save a large portion of his income as an adult? Or do you think this will backfire and he’ll turn into a spendthrift once we’re not there to “make” him save?
All I know is that I wish my parents had made me do it.
