Confession: I hate saving.
I’ve mentioned in several previous posts that I’m a natural spender. I have no inborn impulse to conserve. In fact, ever since I started working at fifteen, I’ve pretty much spent every penny I’ve ever made. Of course, in the past few years I’ve been chucking HUGE amounts of money at my debt. But still, paying off debt and saving are different skills. Paying off debt I’ve perfected. But now I need to move on to saving.
I’m not going to be attacking my remaining student loan with any great vigor. Why? Because my major long-term goal is to be debt free with a substantial savings by 30. At the end of my seventh year of teaching, I will be eligible to have $5,500 of my student loans forgiven. As long as I continue making minimum payments on my student loans until then, that $5,500 in 2014 will wipe out that loan. At this point in time, I will have just turned 29. So, one half of this long-term goal will be accomplished.
But what about the savings? I’ve been stressing about this for the past few weeks because I know that saving is what I need to be working on, but I also know myself…and I’m a terrible saver. I toyed with the idea of just fully funding my Roth and having it double as my emergency fund, but I’ve proven that I really can’t even be trusted to leave that untouched. Besides, it’s almost universally agreed on in the personal finance world that having a few months worth of emergency savings in cash on top of retirement savings is ideal.
I think – after much obsessing – that I’ve gotten to the root of the problem: the vague nature of “emergencies” and “retirement.” It’s hard to envision an emergency or retirement until one of these situations is upon you, thus mitigating the urgent desire to save for one or the other. It’s much easier to save for something specific, something tangible. So I’ve devised a plan to manipulate myself into building an emergency fund.
I’m not going to call it an emergency fund, or even my Freedom Fund – which is how I’ve been referring to it on this blog. I’m going to call it my Move to NYC Fund.
I know what you’re thinking: WTF?! Let me explain.
Moving to NYC is a dream of mine, but alas, a dream that is unrealistic given my profession. But it could happen, particularly if things in my personal life here go south. So, since moving to NYC is something that I’ve dreamed of, I think I’ll be more enthusiastic about putting money in a savings account that is for this purpose. In reality, I will probably never drop everything to move to NYC. In reality, this money will be for emergencies. But if I call it my Move to NYC Fund, I’ll fund it. And if I have to use the money for an emergency, I’ll be more likely to replace it quickly.
And hey, there’s always the possibility that someday I could actually use it to move to NYC. That’s the magic of this strategy; even though I know I will probably never use this savings account for a big move, I find the mere possibility of fulfilling a major dream deeply exciting. And there’s the trick: I’ll feel excited enough to actually save.
So starting in 2012, I’ll be embarking on a two year journey to build a $10,000 Move to NYC Fund.
Do you ever play elaborate tricks on yourself to accomplish your goals? Or am I seriously crazy?