The savings plan and yes the OCD kicked in

I have had a hard time saving physical cash. Saving money on my budget is a breeze but having a physical cash on hand was difficult because I could always find something I either needed or wanted. That is one reason I started my “emergency fund” with silver. While not perfect I would have to actually sell the silver if I needed the cash for an emergency and it’s amazing how few emergencies that were so bad I could not “cash flow” to pay for it. Needless to say I had to start thinking of physical cash in a different way.

A paper dollar has no “intrinsic” value.  I think the best way to illustrate that it is legal to burn paper money if you wanted too but it is illegal to melt down a penny or nickel and sell it at a scrap yard.  The penny or nickel has an intrinsic value based on it’s metal content, but paper money does not! Now that’s not to say cash doesn’t have value, it does but that value is based on the fact that people believe it is valuable and the government say people must accept it for all debts public and private. Of course you can get as deep as you want on monetary policy as you want or rave about the gold standard or whatever but when it come down to it cash is simply another commodity for barter that everyone sort of agrees is worth…. and is willing to exchange products and services for money.

The government shutdown got me thinking hard about money and how I could survive if my SSD check did not go into my account. It was almost panic inducing for me because I had no control over the situation. While I had plenty of goods and backup on hand for basic survival my bills still needed to be paid on time or I would face late fees and extra interest at best or turned off utilities at worse. If the utilities got cut for non-payment I would have to pay a hookup fee or possibly a deposit to restart those utilities. I don’t know how it works for you but if I missed a payment it always seems to take me 3 months to get back on track with my budget and I really did not want that to happen.  I needed a basic emergency fund and to look at physical cash as something I have on hand just like beans, bullets or water.  I was a little slow connecting the dots but having a different mindset is helping me a lot on the savings plan.

The plan I’m using is a combination of the Dave Ramsey Envelope method and the one I read about on Survival Mom’s website based on the number of the week. One week one you save one dollar,week 2 save two dollars and so on. But since I get paid monthly I set up an envelope for each months total cash savings:

  • January $15.00
  • February $30.00
  • March $36.00
  • April $80.00
  • May $82.00
  • June $102.00
  • July $118.00
  • August $134.00
  • September $190.00
  • October $170.00
  • November $186.00
  • December $202.00
  • Extra Savings envelope

Now if I stick to this plan I should have a min. of $1345.00. I added the extra savings envelope that I could sort of fall back on if I needed some cash for the later months that require more money to stay on pace. The extra savings envelope is also for a little emergency that hopefully leaves the main savings plan untouched.  Just like when I started out preparing, I did not go and buy everything I needed in one shopping run but slowly built up my pantry.  This is a start of my cash savings plan and I think it is very doable based on my budget. You could easily flip the weeks around and start at week 52 rather than week 1 if you think it might work better for you or if you want double or triple the amount if your budget allows it or cut the amounts in half if you need to start a bit lower in total cost.   I think it is very important to get in the habit of saving and in a power outage, internet hiccup to a full blown economic collapse cash is king at least in the first few weeks or months.

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2 Responses to The savings plan and yes the OCD kicked in

  1. Snake Plisken says:

    Very good points my friend. Especially on the savings envelopes. I’m going to begin a similar program.

    I do have thousands of dollars worth of silver tucked away and that came in handy this last January and February. I’m fullblown commission sales guy and do not take a regular salary. I enjoy and relish my freedom but it comes at a price. I often do not see a paycheck for a month or two at a time so I have to budget carefully to bridge the financial gap. I do this with silver. When my finances get tight I break into my safety deposit box and sell off some silver. Once I get paid again ( it’s usually a large lump sum ) I then buy a couple of thousand dollars worth of silver replenish and grow my cache.

    I know that this doesn’t work for most persons but it does for my situation.

    • Jamie says:

      Snake: Do what works for you! I started my little silver stash doing sort of what you do, but I read about people hoarding cash and it was hard for people to exchange silver or gold for cash.
      Now my silver is for long term and cash is for short term. It took me a long time and financial education to mentally adjust how I treated money and cash.
      It was hard to break the Programing of the SPEND/DEBT cycle.

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