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Saving money... Period

I have been wanting to do a post of epic proportions for a while. Hoping to gather some decent insight into the saving habits of other college aged bloggers, I scoured the internet. Not only was I disappointed with the results, but I was absolutely devastated to realize that there are so many college students who don't understand money. Don't understand the fundamentals of saving money. Don't understand the consequences of credit cards. Don't understand. Period.

A few blogs I ran across were of similar-aged college bloggers asking for savings advice. The advice they received were no-brainers.

Create a budget. Stick to the budget.

It took me a whole year to figure out my budget and it will take me longer to stick to it 100% every month.

So where's the middle ground? Where's the hope for the hopeless?

I think this comes with negotiating with youself. Figuring out, what you need to do and make sure those things are taken care of first. And then the things you want to do... Coming from a society of instant gratification it will definitely be harder to sacrifice certain trivial luxuries for other certain trivial luxuries, but those sacrifices have to be made.

Don't buy any new clothes this month so I can go out partying with the girls.

No matter how silly it may seem (and let me tell you re-reading it aloud, its very silly) that kind of a mentality will keep you out of debt and will help you save while sticking to your budget.

Although, budgets still don't make a lot of sense to me.

It doesn't make sense to budget $50 every month to clothes. How will that help me develop good spending habits if I'm alloting $50 a month to clothes? This far into my savings excursion, I'm still not seeing the sense in that.

Lets say I get paid $1000 every month. $200 towards rent, $200 towards car, $100 towards utilities and $100 towards insurance. That is a total of $600 with a remaining $300.

If I do a traditional budget, I would budget $100 to savings $100 to groceries, $80 to gas, $20 to personal care, $50 clothes, and $50 entertainment.

$50 a month on clothes is $600 a year. Assuming you don't buy a new wardrobe every season, using frugal methods (I've blogged enough about that) you can buy the seasonal necessities in one month and keep it lasting for the next three months. What happens to the remaining $80 you budgeted for clothes? Or the remaining $440 for the total year that wasn't spent?

It gets used up into something else which goes against all budgeting rules, especially Dave Ramsey's zero-balance, "every dollar has a name" philosophy. If every dollar has a name and forty of those dollars are named clothes, but I don't need new clothes, why name them that in the first place?

Why not name them all savings and budget on a short term basis with longterm goals?

Think about it. The $600 I budgeted for was for the "Need To's". I need to pay my rent or my landlord will kick me out. I need to pay for my car or it will be repossessed. If I take care of those and throw the rest of my check into savings, all of my dollars are then named Savings. Now all of my Mr. and Ms. Savings are living happily in my savings account.

I'm going to call it a Swinging Budget.

If my longterm goal is to have 3 months worth of savings in my savings account, then I create a budget that will help me obtain my longterm goal.

Having a swinging budget gives me the option to spend Ms. Savings on $50 clothes every month OR Mr. Savings on $50 entertainment every month, while leaving me $50 for my savings account each month. BUT since they're all named Savings, I might be less likely to spend my Savings Family until my savings goal is met. Not including them explicitly on my budget, allows me to spend more implicitly. And this method helps me to work on my negotiating and sacrificing.

What's in a name? Everything! Once you get started on your savings goals you'll be surprised how horrible you feel breaking up your savings family. The more you negotiate with yourself and the more sacrifices you make, the more you realize what was really important in the end.