Keep an eye on political news and make sure you can get that money out fast in some cases it can take 2 months to get your money from a 401k

Cheers,

-Adam

“I think it is important to note that change in a jar or excess monies in a checking account (as long as it isn’t a high balance reward checking account) are LOSING MONEY at the rate of inflation. I don’t agree that this is a saving technique. If you gave me a dollar and a year later I gave you back 96 cents, would you consider that a savings technique?”

Only if you leave it in the jar in the long term. The lady in the article deposited the money once she had a certain amount, which would probably be at least once a month. It was money she would have otherwise spent, so it’s not as if it would have been in a savings account.

—-
Austin Hike and Bike

Point is, if we didn’t do that we would just spend the money on rubbish - but instead it’s saved and we use it for something worthwhile.

I don’t need a digital camera; I could justify buying it, but I don’t need it.

To mwarden @42: “something nice” could be anything. Why does it automatically have to be something you think is “bad” or something unneeded? Maybe I prioritized my spending plan and the cutoff was the top two items on the list, but after saving some loose change I find that I have enough to take care of the top three instead. Does that make #3 on the list bad or unneeded? Of course not. Maybe my definition of “something nice” is a college class I couldn’t justify earlier, or maybe “something nice” is an extra trip to see family. Think positive!

To Anne @41: someone says they’re going to save every $5 bill and you say they don’t have a goal? You’re being silly. Saving every $5 bill or whatever is a goal!! As I pointed out above, maybe you have your spending plan under control and are doing well but there’s something you wanted to add to your plan but couldn’t justify. This “found money” could be used for that.

I think too many people are too uptight about being perfectly exact. To say that you have to have every last dollar mapped out and planned for is silly. Rigidity is exactly what makes all plans fail. Plans, especially spending plans, have to be flexible. I think being able to “find” money in every day transactions and save that money is a positive thing, not a negative.

She can afford to pay $7,500 every month (highly impressive) but only $12,000 in three years? Hello? That’s $15,000 in two months, but only $12,000 in 36 months?

If your attitude is right “Don’t buy what you don’t need” “Don’t buy what you don’t have money for”, you can do just as good (if not better) than her. Saving based on bills is silly, save every buck you have, every penny you have and it’ll add up quickly.

$12,000 in 3 years is nothing more than $4,000 a year, $11 a calendar day, or $17 a working day. I know people living on minimum wage who can save this much (in other words, people who find her saving strategy surprising is just plain stupid).

I actually keep track of how much I’ve saved and put away for each demonination. So far for the year I’ve saved 197.50$ (those loonies and twonies really help me out here)

Call this what it is: it’s a way to curb spending. If you hide money from yourself, you can’t spend it. The person with the $5 bill idea says that her method takes incredible discipline. If she has incredible discipline, WHY DOES SHE NEED THE METHOD?

“In 2-1/2 years, Kris saved an extra $500 using this method. That’s enough to treat herself to something nice.”

All due respect, but why is she “treating herself to something nice”? That sounds like code for spending money she doesn’t need to spend. That sounds like the problem, not the solution to a problem.

My last haul was five dollars in dimes, two dollars in nickels, and ten dollars in pennies. Mind you, a lot of those pennies were stashed by my mom, but they still helped.

Recently, my apartment building changed its laundry machines; they don’t accept coins anymore. I used to set loonies (one-dollar coins) and quarters aside for my loads; now that I don’t need them anymore, I stash my quarters so that I can roll them up and deposit them. I just need one more so that I can haul ten dollars to the bank.

Step 1: Figure out what you want to save for.
Step 2: Figure out how much money you’ll need, and when you’ll need it.
Step 3: Set aside as much money every month as you need to reach your goal on time.

The fact that the author of the piece doesn’t have a clear goal is telling: “People always ask me what I am going to do with the money in my fives accounts. I have no idea. I’m having too much fun watching it grow to want to spend it.” Saving and investing should have a purpose.

I thought it was funny and teased him about being Type A until one day the lightbulb went on in my own head. I now save ones and use them for pampering, etc. I also save quarters for laundry and dimes for things like library fines. Nickels and pennies I donate to an organization.

I find this a fun way of adding to my savings. I used to be a heavy debit card user and now that I’m trying the envelope system, so I have more cash. I think I’ll take a look at saving fives.

The only way this sort of thing works is if it causes you to reduce your spending (or, I guess, if you write about it and increase your income). Otherwise it’s just unnecessary overhead. If you save a five dollar bill, but don’t reduce your spending, that just means you have to take an extra five dollars out of the bank in order to put it back later. Similarly, spending change is only bad if you spend it on things you wouldn’t've bought anyway.

It’s great that she’s managed to save $12,000 over three years with this “trick”. However, I saved over $25,000 last year with a combination of automatic withdrawals and saving all windfalls and money that’s left over at the end of the month. Doing it via five dollar bills wouldn’t increase my savings, but it would require a lot more trips to the bank.

Beth, even though all compartments are the same size, you choose how much you want to put in. For example, our save position is a lot more filled than our spend portion right now.

When I was in college, I bartended 5 nights a week to pay for school and rent. At the end of each shift, I’d end up with a tip jar half full of change. The servers and other bartenders usually didn’t want to lug home an apronful of change after a long night, so they’d just toss their coins in my tip jar on their way out. I would deposit the cash and payroll checks to pay rent and bills, and I’d put the change in a large bin at home. Every Sunday, I’d wrap change while I watched “Sex and the City.” This became a weekly ritual. Over two years, I paid off over $6000 in credit card debt using the “change fund.” Even though I’m now paid through direct deposit, my husband and I still save all our change in a large jar. When the jar is full, we wrap the change and use it to make an extra payment on our car loan.

http://www.scotiabank.com/cda/content/0,1608,CID12190_LIDen,00.html (NOTE: _not_ an affiliate link)

I took that idea and the one about rounding up in your registry/saving change from cash spent and put them both together… nbut after a couple months of that I realized HEY! I’m screwing up my financing!

I wasn’t adding in my change from tips into my cash income. But the change from purchases made with the cash tips I WAS counting also went in the same change jar… and then got added to my income as tip money when it went to the bank (about $70/month). Problem was, all my purchase-change was getting double-counted as income. Maybe $10 a month or so. Not a lot but enough to screw up my income estimates (not to mention increasing the amount spent in each category that I spend cash in)!

I started using quicken a couple months ago and I figured out how to fix my problem (besides using separate jars, which I would still manage to screw up). When I enter the data from purchases into my cash registery in quicken, I also have a “change” account that is hidden and not in my toolbar. I can enter the full dollar amount as I have been, but use the split function to put the exact amount spent into the proper category and put the change into the other registry. That keeps my expenses neat and tidy, and when I go to put my jar in the bank, I can subtract the “change” from the full amount and I have my change-tips amount for the month. No double counting income.

Sounds a lot more complicated than it is (and no it doesn’t beat paying yourself first–I do that too).