Recently, we saw some online promotion and hashtags around saving up for the future and just general thoughts on good practices with money. Chris and I started talking about life and how we’re set up for later on and we realized that we’re actually already on a good track, without having put too much effort into it. Now we’ve decided that it’s time to start intentionally doing a better job saving for the future by making some solid plans.
Since we travel a bunch, it makes sense that travel is one of the things we save for. We’re pretty conscious of this and actively make an effort to save for traveling with the kids. The other thing we’re saving for is retirement, but we’re changing that up real quick because we’ve been pretty passive about it. What else should we be saving for?
Note: We are not financial advisors and are only sharing what we’ve done through the years to save and have travel funds available. Talk to an actual certified financial planner if you get inspired to save for the future.
Teaching our kids to save
I’ll be the first to tell you that we’re not going to go out and buy cars for our kids or jump on co-signing a credit card with them the day they move out and want to go have fun. What we ARE doing, though, is setting them up for success without them even knowing. From saving their little bits of money in piggy banks to having conversations with our Oldest about making quality purchases, we’re working to instill a sense of value and financial understanding as best as we can.
One of our New Year’s resolutions is to set up the kids’ own savings accounts with our bank. Why haven’t we done this yet? Because we always forget to bring their info with us when we’re by our bank. No other reason. We just keep spacing it.
2017: The year of saving for the future… and really helping the kids build a framework for their own futures.
Note: a lot of banks offer special accounts for kids that don’t carry fees and have special rates in hopes of encouraging kids to save. Why not take advantage of that?
Saving for travel
For so many people, exciting travel seems like a complete pipe dream. I recently read an article that made me chuckle. It said travel isn’t accessible to everybody and we should all stop saying that it is. But I know differently! If you budget, research, save, plan and are responsible with money, travel is completely accessible. True, your dream of spending two months lying on a beach in Tahiti might not be feasible any time soon, but awesome weekend trips, road trips or not-too-distant beach holidays are attainable. Saving for the future can be travel related and doesn’t have to feel totally ridiculous or irresponsible.
We have a savings account we use for travel expenses and any sort of freelance income we get that’s not already earmarked for another project or known expense is put into this account. Those who don’t have freelance incomes can add to the account with bonuses, commissions and tips.
Disclaimer: I make money from writing and photography which we consider a bonus since my actual job is being a stay-at-home-parent. This is HUGE help in saving for travel, but it’s not the only way we fund it.
Another way we’ve been able to save for travel in the past has been with stock grants through our employers. True, the nature of stock grants is for long-term investing and building wealth, but when you’re young and not terribly concerned about the big picture and find great value in the experience of travel, exercising stock options may be an idea to fund your adventures. (We’re not saying to shift what you’ve been saving for the future to go drinking in Cancun, just making the point that employer stock programs are an option to fund life-changing travels that truly expand your family’s horizons.)
One other thing we’ve leveraged to make our travel more affordable: credit card points. I say “points” and not miles because every bank is different and ours offers a point system that is REALLY flexible. It’s been a lifesaver for booking travel!
Saving for early retirement
Life is about so much more than working. Yes, having a career / job is important and it’s how you’ll secure your future and ensure that you’ll be able to live independently from your kids. But we’ve recently started thinking about what it would be like to be able to fully enjoy life without being obligated to an employer or needing to work in order to pay bills.
We’ve also started talking about our big life goals, like when we want to be able to retire. This is not so relevant for me because I get to be a stay-at-home-dad, but Chris works really hard for our family at a desk job. We would love to have him officially retire before 60, but so far don’t no how to make this dream happen. Once we realized how quickly time passes, saving for our future has suddenly become crazy important to us!
We want to be the type of parents who are there for our adult children. We want to be able to be grandparents who are present and available to enjoy the family we’ve spent our lives building. If we can retire early, hooray! We’ll love being those old guys who get to tote their grandkids around and show-up unannounced at our kids’ houses for BBQ. Of course, we have no clue how much we’ll even need to retire, so here’s how we’re getting started now:
- Reviewed our 401K savings and looked at the distribution
- Reviewed the stocks we’ve gained from employer grants over the years (and that we had not yet cashed out)
- Found a highly-recommended local financial advisor we’re meeting with. We’re really looking forward to taking this big step!
Creating a savings cushion
Again, this is something that for so many people seems to be merely a dream in the distance. First, let me define “savings cushion” as funds available in a savings account and accessible for emergencies, like an unplanned and totally ridiculous home or car repair, or the unexpected long-distance travel to help care for an ailing family member. When you feel your world starting to slip a bit, this cushion helps keep you standing.
So, how do you create this savings cushion? Squirreling away a little bit here and there really adds up over time. When I say a “little bit” I truly mean a small amount. One man’s change is another man’s fortune, right? Well, here are some ways you can hide that money away and then someday have a nice surprise or even a small safety net. I refer to these as ad hoc savings, because they’re just that — spur-of-the-moment or blatantly visible savings options that will do the trick of saving with nothing complex about them. For instance, for our rainy day funds, we use a piggy bank. Taking out an extra $10 or so when at the grocery store and the teller asks “Cash back?” and then putting it someplace out of sight.
There are also savings resources that a lot of people have available to them but might not take advantage of or even know about. For instance:
- “Keep the change” debit transfers, where your bank puts a little into savings with each transaction
- Health Savings Account – I am listing this because the pre-tax dollars are a “big picture” savings. When a medical emergency or routine expense comes up, you’re not pulling from your travel fund or taking out a 401K loan.
- Employer stock programs – if your employer offers it, you may be able to put away a small percentage of each paycheck towards purchasing company stock at a discounted price. This is great because it typically is done quarterly and with minimal restrictions or tax penalties.
Everybody has a different financial situation, but even the smallest amount of saving will grow over time and when you see the growth you can feel encouraged to go deeper into saving for the future. And if we learn anything new or have any huge breakthroughs in how to teach kids about money, I promise to share them ASAP! It’s another part of parenting that’s changing every day and we’re navigating for the first time. Happy saving!!