One time, when talking to a student about the money in her bank account, she told me, “If I see it, I spend it.” To save money, she only had one choice: to set up auto-savings with her checking account. After each pay period, a certain amount was transferred to her savings account without her having to lift a finger. She said she was saving for a dream home while working at a pizza place. She was paying her future self. 

How do we pay ourselves? The first step is ensuring we have money left over after our bills are paid. We need to see how far the paycheck can stretch, which means adding up expenses and building a budget. One of the best benefits of budgeting is simply knowing our numbers. What do we bring in monthly? How much flows out? What is leftover?  

If nothing is leftover, we need to increase income while revising our expenses. This year, we re-did our family budget, and I decided to only calculate our essential bills first, before considering shopping, dining out, traveling, and entertainment. Once I knew how much it costs us to survive, then I was able to be strategic with what was left over. I could spend while saving.  

It is also useful to know where the rest of the money is going. A student recently told me that he added up just his dining out costs, and it totaled $800 a month. He was shocked. The student decided he could save some of that by buying groceries instead. With a dining out budget of $400, he created a savings goal of $400 a month. 

Saving money is not just financially empowering. Having an emergency fund of even just $400 can offer peace of mind. It is best to put savings in a separate account that is not used to pay regular bills. A mobile banking app can help monitor accounts and transfer extra money to savings. 

It can also be helpful to set goals, such as hitting that first $100, then going for $500, then the big $1,000 (triple zeros)! When you get excited about saving money, it becomes easier to make life adjustments that help save even more. It’s addicting in a good way! 

Another thing to love about saving for future purchases is the power to avoid borrowing. Credit card debt is over $1 trillion in this country and climbing. The average household easily owes more than $5,000 in credit card debt that continues climbing each month. Most of the minimum payment only goes to interest, which is taking from our hard-earned dollars and our future funds for saving, giving, investing, and buying. 

Interest is the extra fee we pay on top of what we borrow when we are not able to pay off the debt right away. Credit card interest rates can easily climb above 20 percent, which means for every $1 dollar we owe, we are paying another $0.20 or more per year. That’s a 20 percent loss of every future dollar’s value. What if I could instead put that in a high-interest savings account? Imagine making interest instead of paying it. 

And remember, savings is about more than just an emergency fund for the unexpected: car repair, cell phone replacement, visit to a health clinic, etc. Savings are also for the things we need to buy, including big ticket items such as a computer for school, a new vehicle, and housing. Consider saving for a rental deposit or a 5-10 percent minimum down payment when buying a home. Savings can be the key to our financial freedom and independence.  

Crunch some numbers, try to have fun with it, and set some goals that can empower your future. Your future self will thank you.