I have always had a piggy bank of sorts for as long as I can remember. The purpose was always the same over the years. I kept a piggy bank to save money to buy a specific item or to save for the holidays. There were times when I actually maintained a piggy bank just to get rid of coins or loose change to make my purse lighter.
Recently, I decided to redesign my money plan to help me accomplish specific money goals. The plan requires that I prioritize the goals in order of importance. This led me to rethink how I saved. It was time to craft a strategy about how I saved.
The story behind the why
Funding a regular saving account to set money aside for emergency may not always be possible because other money goals become prioritized.
Debt cannot be a factor in the wealthy equation. When debt is present funds that would normally go toward building wealth goes to the debt. This causes the amount of money available for wealth-building to become diminished. The best solution is to work toward removing debt from the equation and freeing up money to put toward building wealth.
One of my money goals is to eliminate consumer debt. To successfully do that I had to rethink my entire money plan and re-prioritize my goals. This placed paying off my remaining debt over saving. This means finding other ways to keep saving. Eventually, the piggy bank was the go-to choice. But I had to make this option more than just taking money out of my purse to make it lighter. I needed a strategy that would allow me to maximize every penny of loose change.
I came up with this strategy to make my piggy banking more purposeful and methodical:
- Solution #1 – Scheduled deposits to piggy bank – I scheduled to add change to my piggy bank on a specific day each week. I chose Saturday of each week.
- Solution #2 – Any denomination of currency in my purse that was $1 and below went to the piggy bank.
- Solution #3 – I deposit the content of my piggy bank twice a year June 1st and December 31st.
- Solution #4 – I focus on cutting expenses on other spending categories as much as I can to have change for my piggy bank.
- Solution #5 – I do not take money out of my piggy bank until time for bank deposit.
Although saving is not currently a top priority, rather than completing eliminating it from my plan, I found ways to fund my saving plan by being strategic and methodical. This method of piggy banking keeps me motivated and focused on attaining my goal to complete my consumer debt since the money that I free up from that goal will then go toward my other wealth-building goals.
This method of focused, goal-driven and strategic piggy banking promotes:
- Living on a monthly money plan or budget to explore ways to save
- Responsible spending habits to reduce or eliminate waste
- Commitment to remove debt from the wealthy equation
It is impossible for a person to save their way out of debt. Regardless of how much and how aggressive you save, as long as there is debt it becomes a constant reminder of what you are losing in building wealth.
What you can do
It is always helpful to share what works for me with other persons in a similar money situation. I spent months developing my money plan and can proudly say that my strategies are working for me. I have learned that in order to win with money I have to take drastic measures and do things that normal people would find boring. The reality is that what I am doing works.
If you find yourself in a similar situation I encourage you to try my piggy banking method. It is a method with a purpose that works and which I find very useful.
If you need help starting a monthly budget you can download my FREE tutorial Create a Monthly Zero-Based Budget to help you get started.