This week is America Saves Week and Military Saves Week. While saving ought to be a year-round activity, the purpose of this special week is to raise awareness about the need to save. Why do we need to raise awareness? It’s because most people stink at saving enough. There are some scary national statistics I could quote, but I see enough evidence of this unfortunate fact almost every single day to confidently claim there is a lot of room for improvement here.

Contrary to popular belief, the road to riches isn’t paved with winning stock picks or high margin real estate transactions. The road to riches is paved with avoiding debt. Although it’s the road less traveled, there are no shortcuts. Debt costs money and works against you. It’s that simple.

For many of us the money we earn today needs to support us twice, once in the present, and one more time in the future when we no longer have that income. We may work for 30 or 40 years but have expenses for 60 or 70 years! And thanks to inflation, those expenses will double about once every new generation. So, this is the week to take stock of your spending and savings habits to be sure they are adequate. If you’re not sure if you’re saving enough, consider establishing a baseline plan to see what changing your savings could buy you.

Take this week to examine your savings practices and consider some of these tips:

• Paying off debt is saving. It’s just after-the-fact savings and typically nowhere near as efficient because you’re usually paying more than you’re earning. So pay off your debt before saving. The exceptions: be sure to save enough for upcoming necessities, keep at least a month’s worth of expenses in savings as an emergency fund, and get any matching dollars available in your employer’s retirement plan.
• Are you saving enough to cover vehicle maintenance? Over the course of vehicle ownership, you may need to spend as much on maintenance as you do on gas. The expenses are usually weighted toward the latter years, but you can plan for them by setting aside the same amount you spend on gas each time you fill up.
• Are you saving enough to cover home maintenance? This is one of the most overlooked expenses I see among home owners. On average, most people need to spend between 1% and 3% of the value of their home on maintenance each year, just to maintain its value.  Some years are a lot less, but when it comes time to replace windows, roofs, or your heating system, it can be much more in those years. If you’re not already doing so, consider saving 2% of your home’s value each year to pay for everything from air filters and lightbulbs to new carpet and replacement appliances.
• Do you have a car payment? Even if your car is paid for, you ought to have a car payment. Paying yourself a few hundred dollars per month into an interest-bearing savings account for your next vehicle purchase will help you avoid needing a vehicle loan in the future. Earn interest on your car payment rater than paying interest from it!
• Lastly, automate your savings and pay yourself first.

Saving needs to be a priority. So in recognition of America Saves Week, I am knocking $50 of the price of my financial planning quick start and tune up appointments. If you want to spend two hours talking with me about a savings plan, paying off debt, or becoming more efficient with your money at the discounted rate of $300, you must schedule this week. The appointment can occur in the coming weeks, but  you must contact me or book online by Friday, February 25th to qualify for the discount.

Happy saving!