I also know many of you would be in a very difficult situation if you
suddenly needed to come up with $1000 cash tomorrow. It is easy to DO
something about that!
Stores, leasing companies, banks, utility companies, and the
government LOVE auto-payment plans. These are the ones where your
bills are automatically paid directly from either your bank account
or your credit card account. These work. You know that "x" number of
dollars is going to be withdrawn from your bank account for your
mortgage, your car payment, your power bill, your satellite bill, and
whatever other auto-payment choices you have signed up for.
Auto-payment and auto-spending are so normal, that we don't even
think twice about it anymore. All of us can think of things we need
to spend our money on this month. And all of us can think of things
we WANT to spend our money on this month. BUYing has become so
naturally – we can do it in auto-pilot. "Where did the money go?"
becomes a question many people ask EVERY month.
At Cindy's Porch, we want to make AUTO SAVING just as automatic. We
started very small with our Christmas Cash Stash – a piggy
bank or jar to collect our loose change. Our pig gathers between $500
and $700 every year. Now we are taking the next step: An Emergency
Savings Account – The Sophie Account. The Goal is to $1000 in this
account by this time next year (some of you will want more – that is
your choice! DO what is right you for).
Many of you are going "$1000!? Cindy are you crazy? I don't have that
kind of money hanging around!" That's why we DO it a little at a
time. You need to talk to your bank. Set up a special fund where
$20.00 per week (or $100 per month) is automatically transferred from
your checking account into this savings account. The secret here is
AUTOMATICALLY – you don't have to think about it. It just happens
like clockwork. By next this time, next year the money will be there (and
you won't even have missed it!).
DO a little bit of research. Contact your bank and ask about rates.
Check other financial institutions – perhaps they have something that
will work better for you. Please don't be afraid to ask questions –
the person on the other end of the phone probably doesn't have an
emergency fund set up either.
"BUT Cindy, why do I need an emergency fund? I can just borrow the
money or use a credit card." That's the thinking we are trying to get
away from at Cindy's Porch. Every time you rely on going into more
debt to solve a problem, you open the door to let that
critter "WORRY" back into your life. We are DOing away with debt –
not letting it back into our lives. An emergency can happen at any
time – this morning we have to take our oldest dog into the vet –
something happened to his backside over the weekend and he is having
trouble going up the stairs. I am worried about the dog. I am NOT
worried about the vet bill.
And I love what one of our members sent in a couple weeks back. "When
you have an emergency fund set up, Murphy doesn't come visiting any
more." Who knows, perhaps Murphy and his mischief is more attracted
to people who are not prepared. Me – I like to be prepared.
So – you have all been challenged! $20 per week (or $100 per
month) into a special Emergency Savings Account. I call it "The
Sophie Account." (Sophie is Murphy's twin sister – when he comes a
knocking, Sophie is usually just around the corner to make things
right.)
Last note: Here's a quote from Henry Ford (I am paraphrasing a bit
here). "Whether you think you can or can't - one of them will be
right."
Think you can!
Cindy
Medium Term Savings - Your Sophie Account