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Your Savings Plan

BOSTON (CBS) - Many people equate saving with some sort of deprivation. If they give up eating out and having fun they can save money. If you deprive yourself of all of the fun stuff in life you will never stick to a savings plan.

Your Savings Plan

Let's start with looking at the ways you spend your money. This will mean you will need to set up a budget. Where does your money go each month? Write down your income. Then spend some time finding all of your expenses. It always amazes me if I go to the ATM and take out $100 and at the end of the day I have $8 left. Where did it go?

What happens to the discretionary money in your budget? This is money left over after you have paid your necessities like the mortgage, rent, electric and health insurance.

Look at your credit card bill. What are you spending your money on? Meals out? Entertainment? Clothes? Gifts?

A big budget buster folks were telling me is eating out or doing take out. Especially dual-income families when both mom and dad walk thru the door at night and they have to feed the kids. It's so easy to just bring home take out!

So where are the holes in your budget? Lunches out every day? That's easily $50 a week. Packing your lunch could save you $2,000 a year. If you both bring lunches from home that is a savings of $4,000.

This is not a hardship. I did not ask you to skip lunch, just bring it from home. And yes there might be some days when you eat peanut butter and fluff.

Do that for 20 years and invest the money in your retirement accounts and we assume the money earns 8% you could have close to $200,000 in your nest egg. Do it for 30 years over your working career and it amounts to $500,000.

Packing your lunch is just the beginning. Try other small ways to do things differently so you can save big.

Money Conference Alert!!

On October 11th I will be the key note speaker at The Money Conference which is a FREE one-day event presented by The Office of Massachusetts State Treasury. It will be held at UMASS Boston and the first 500 registrants will get a free copy of my newest book, Money, Your Personal Finance Guide.

There will be afternoon classes on everything from budgeting to buying a house. The Financial Planning Association of Boston will have volunteer financial planners there to help answer questions. You can set up a meeting with a Money Mentor when you register. If you have questions about the conference, contact Sheila O'Loughlin of the State Treasury at (617) 367-6900 ext 615.

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