The Power of Saving

By Cindy Diccianni

How you save your money is just as important as how you spend your money. After all, they really do go hand in hand. By developing a practical plan of action, you will save more, spend less, and launch yourself on the path to financial freedom. These principles will get you started.

Your Approach To Savings

The ability to save relates in part to your perceptions of money. If you have a healthy attitude towards money, you will reward yourself by developing reserves and saving for the future. You will also prioritize your needs above your wants and control your spending on luxury items.

Financial Strategies for the Marriage Years

It's vital that you have started the habit of saving before now. Life moves quickly and there is little time to catch up, this is why it is important that you develop a savings plan early on. Once you are married you will need to buy homes, cars, furniture, vacations - just to mention a few major expenses. Then there are taxes, taxes and more taxes.

If you have a good savings mentality and have been diligently following a saving plant prior to this stage in life, not only will your expenses be paid, you will always have money in reserve. You'll never feel as though you are constantly trying to catch up.

Teaching Your Children to Save

It is important to develop good saving habits when your children are young. Teach your children to save for their future by setting aside small amounts (up to half) of their allowances in a passbook or statement savings account. And teach them not to touch it.

Explain how money increases over time through regular interest payments. By teaching them about the benefits and rewards of savings, you will reinforce the importance of slow, consistent savings.

Keep in mind that your children learn by example. They pick up your attitudes and habits like a magnet, and will develop the pattern of savings they see evidenced in your lives.

Children's College Education

Start to save for your children's education when they are very young. There are several ways to do this: 529 college plans, educational IRA's in the U.S., and Registered Educational Savings Plans (RESP's) in Canada. You can also invest assets in mutual funds and a savings account. Additionally, it is important to teach your children that their education is an investment in their future.

As the college years approach, it is especially vital that your children understand the power of savings and the dangers of debt. Credit card companies bait young teens with credit card applications in college, and so begins the cycle of debt. It is easy and tempting for young people to use these cards, creating higher and higher credit balances. Teaching and applying limits to yourself and your children helps reinforce the power of saving and the value of money.

Tools For Savings

The most important aspect of savings is to start now if you haven't already started. Many of us were not taught to save. In many cases, our grandparents were immigrants who literally worked until they died. We now live longer and work harder than ever before. It is imperative that we develop a plan for saving and follow it through with due diligence.

Savings tools include:

  • Pay yourself first. Save at least 10% per paycheck. If 10% is too much at first, start smaller and work your way up.

  • Put money in your company's retirement plan. Take full advantage of any match money available.

  • Save additional money in a money market account for an emergency.

  • Keep accurate records of how much money flows in and out of your home. You should know how much money goes towards fixed expenses each month (needs-based bills, rent/mortgage, food, car expenses, utilities). You must ensure this money is available.

  • Know exactly how much additional money is available and identify how it is spent every month.

  • Pay down debt and get rid of it. Eliminate credit cards and pay cash for purchases. Or ensure you pay your credit card balance each month and avoid paying interest.

  • Be aware of how you spend your money. Avoid waste.

  • Insure yourself and your family for catastrophic loss-death, disability and health to protect your savings.

By following this process, you can develop a plan of action now to save more and spend less. Make good financial decisions and seek the advice of a Financial Advisor for those aspects of investing that you do not understand. Reward yourself in the future by planning today!

Cindy Diccianni (RN, CSA, CWI, CLTC) is a Registered Nurse, a Certified Senior Advisor (CSA), a Registered Investment Advisor and a Registered Representative with Leigh Baldwin & Company member NASD and SIPC. She is affiliated with Ortner, O'Brien & Ortner Advisory Group, Inc. and co-founder of Nurturing Your Success, Inc. Her passion is assisting clients in creating the financial freedom they dream of. You may visit Cindy at or write to her at You may also call her directly at (610) 251-9393 x206.


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