How about this method for saving: all the extra expenses we have (meaning not essential), like coffee, cigarettes, doing sports, a movie, the equal amount we spend on that, we save it as well. Do you think this could work? It would be a great idea to save money and to motivate us not to spend more.
You mean like every time I buy a coffee I put aside the same amount of money for saving? Or am I not understanding?
I think this is a great idea for people who need a tangible goal and something that gives them a checkpoint system (so to speak) for the accomplishment of saving. Personally, it would never work for me. I'm pretty good about keeping my budget very rigid and actually following it. Savings, in my budget, comes before all other spending. So I take from the top, put it into saving, and then divide up what is left for the month so I know what I have to spend. We actually have a category in our budget called "entertainment" which is the category under which these things you've suggested would fall. My entertainment budget per month is far less than what I put in savings. I think it is more important to put something away for later (kids education, my retirement, buffer account for emergencies) than to have a Starbucks every day.
That's exactly it, if we are spending a certain amount, we should save it as well, this way we will think twice before doing it. Sometimes I spend some money in things I really don't need and later I might not have for vacation for example, so this is a good incentive. Claire, if you're saving more than you spend this doesn't work for you true.
