Zen Penny

Seeking the Path to Financial Nirvana

Archive for the ‘savings’ Category

A Small Financial Victory

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For the past year or so, I’ve been encouraging my girlfriend to participate in her employer’s 401(k) plan. I’m honestly quite jealous the plan they offer because it is managed by Vanguard and the employer match is fantastic. Much better than mine.

Well, I think the pestering finally paid off. She went to the 401(k) orientation meeting that Vanguard presents every few months at her workplace and decided to sign up. She finally realized that not contributing is like throwing away free money. Plus, she will realize great tax benefits next year too.

This makes me feel good. Not only for her, but for us. Our financial futures will be that much more secure.

Written by Zenpenny

May 4, 2007 at 6:47 am

Kick Start Your Savings With Microdeposits

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We live in a world of microtransactions. Vending machines, convenience stores, the check-out aisle at your local supermarket, and even video games, we are constantly being bombarded with convenient ways to part with our loose change. To counter this, I have begun making microdeposits into my savings account.

My Orange Savings account with ING makes it fast, easy, and free to transfer money from my linked checking account. Everytime I end up spending money buying something small on a whim, I try to deposit that equivalent amount in my checking account. I set my minimum deposit to be around $2 regardless of whether I spent that much or not because it’s nice to see the tangible difference a couple bucks here and there can make.

This method works even better if I preemptively deposit money anytime I am tempted to run out for a candy bar or a greasy value meal. This act alone forces me to take a few seconds to reflect on whether I absolutely need whatever it is I want to buy. The answer is usually no but it doesn’t always prevent me from buying it anyway. But at the very least I made a small contribution to my financial future.

Microdeposits offer three great benefits to me:

1. It’s a great way to supplement my savings account.

2. It often serves as a preventative measure against making small purchases.

3. I don’t feel like I am denying myself because I can get away with a few impulse buys as long as I pay myself first.

Of course, this process is not meant to replace an automatic savings plan. Also, this can be quite time consuming and requires a bit of discipline. So I will probably phase this habit out once I have a better grip on my budget. But so far it has served as a great way to kick start my savings.

Written by Zenpenny

April 1, 2007 at 2:55 pm

Be the Master of your Financial Destiny

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After reading Anxious to Please, a fantastic book on building self-esteem that will be covered in a future post, it dawned on me that that I needed a clearly defined set of personal ethics. Without them, I knew I was doomed to continue behaving in ways contrary to my beliefs and goals. Thus began a period of reflection and self-actualization that was born out of the desire to improve my personal and professional life. But in short time I saw the beneficial effects this process was having in my personal finances as well. Below are seven guidelines developed during this process that have improved my financial outlook.

1. Be Accountable – It is critically important to be honest with yourself and loved ones when it comes to your finances. Unless you can be open and honest your financial future will be shaky at best. Stop blaming your parents, your boss or the credit card company for the poor financial situation you’re in. You, and only you, are responsible for your financial well-being regardless of your circumstances.

2. Be Forgiving – When reflecting on the past, difficult emotions, guilt and regrets are bound to arise. Do not let past financial indiscretions hold you down. You only have control over what you do from this moment forward. Show some grace to yourself and others. The sense of relief you feel will help you make more positive decisions with your money now and in the future.

3. Be Proactive – Remember, it is never too early or too late to start preparing for your future. Every day you don’t have a financial plan in place, you lose money, whether it’s due to poor spending habits, high interest fees on your credit card or even lost returns on your investments. Take action and start today even if you can only contribute a few dollars a month.

4. Be Patient – Rome was not built in a day and neither will your fortune. Don’t try to time the market or participate in risky qet rich quick schemes. Planning for the long haul will secure your future and allow you to take advantage of new opportunities that you wouldn’t have had otherwise.

5. Be Smart – Always do plenty of research before investing. Seek reputable advice; do not trust the “financial gurus” you see in late night infomercials. Diversify your portfolio and then find your comfort level when it comes to risk tolerance. Don’t panic; use dips in the market to your advantage.

6. Be Consistent – Develop a solid financial plan and stick to it rain or shine. Even better if you can make your contributions automatic. Make consistent progress by frequently setting sub-goals and aggressively pursuing them.

7. Be Supportive – Having the support of family and friends will help you tremendously in the pursuit of your financial goals. Encourage others to do the same. We all have the responsibility to help each other out.

I hope these guidelines will help you move closer to achieving your financial dreams like they have helped me. Good luck!

Written by Zenpenny

March 30, 2007 at 4:31 pm