Small Steps, Big Returns
Getting started with smart personal finance isn’t always easy. It’s one thing to read blogs like this one that offer budgeting and savings tips, but it’s another thing to actually do them.
Part of the problem is our society tends to idolize the “big winner” and not really appreciate the guy next door who bikes to work, cooks his own meals, shops at the thrift store, and gets all his books from the library. That sort of life isn’t glitzy. Yet it’s that sort of life that can — and does — lead to true wealth.
Talk with anyone who has dug themselves out of debt, and they’ll probably tell you the same thing: it was months before they made any big decisions. But they did a ton of small things right away.
It’s important to save money on the big stuff, like a home or a car. But large transactions like those are rare. Think about how often you spend more than $100 on anything?
You have more opportunities to save, for example, when you’re shopping for groceries. You can clip coupons, buy in bulk, and shop for store brands. And you can do these things today. Saving fifty cents a week on milk might be inconsequential as a one-time occurrence, but over the course of a year it amounts to $26. Taken together, many such small savings can add up.
Maybe you save fifty cents a week on milk by using a cheaper brand, save $4 a week by clipping coupons, save $2 a week by taking the bus to work or carpooling one day a week, save $25 a month by dropping to basic cable, save $47 a year by canceling a magazine subscription, and save $100 by planting a garden and growing your own vegetables. Small changes, but collectively these choices alone would save you more than $775 a year.
Starting small also has an interesting side effect. As you get in the habit of cutting costs on one thing, you find that you can transfer that skill to other parts of your life, such as wardrobe and entertainment. One small step leads to another.
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