Disturbing Little Tidbit

I was reading an interesting article about consumer spending (read it HERE), and was feeling pretty good about the fact that consumer spending is remaining UP despite all the pressures from rising prices. Then I saw a little paragraph towards the bottom that saving in July dropped by more than a third from what it was in June. That made me sad. And it reinforces for me that Brittan and I share a similar struggle with most of the rest of America: Spending is a stronger force in our lives than saving. The concept of "delayed gratification" is good theory, but tough to implement.

Earlier this week, B and I sat and talked through our spending vs saving habits since we moved to Georgia. In many ways, it mirrors the results of the article. First, our expenses are considerably greater here than in Maine. But they are not outrageous. But when we took a spending audit, we discovered that we had cut way back on out saving and our "impulse" spending was three times what it was before we moved. All of the bright lights and shopping opportunities of the "big city" grabbed our attention and lured us in. We took the bait.

Secondly, because of our spending, our savings went down. We were more interested in shiny baubles than looking down the road. Shame, shame.

Fortunately, we've been through this before and were able to right the ship, before it started taking on water. We didn't do debt. We weren't even tempted to do debt. Not true, I really wanted an ATV, but my convictions about debt are stronger than "off road fever". We won't do debt.

What we decided to do, was go back to the "envelope system" for things like our dining out and grocery budget as well as our "mad money." If you don't know what the "envelope system" is you should read IOU NO MORE (shameless advertisement).

When I get paid, I go to the bank and withdraw the cash for the envelope categories, and once the money is gone, it's gone. It is a fantastic disciplinary teaching tool. It is much more difficult to part with cash than it is to pull out the debit card. Oh, yes, more difficult indeed.

Try it. But more importantly, saving for the future is just as important as spending for today. After all, you might just need to eat even after you retire.