by Randy Tudy
I had fun reading the answers to the survey I conducted. If you were one of those who responded, this article is the first response to the series of articles I will be writing. If you have not participated it yet, click here to answer this ONE survey question.
A good number of responses focus on their problem on saving money. I remember when I was explaining this topic to my students. They were so focused listening to me talking about the power of saving. But when I told them to start saving I got smiles and wondering looks. I knew what was in their mind. They were college students who were trying to budget their allowance. Some said, "My allowance is not even enough for me. How much more if I still save?"
Again, I fully understood their reactions. Then, I declared, "Whoever are the biggest savers will be exempted from our final examination." Not only that. They will also automatically receive a flat one in the final examination grade.
I began to see glowing eyes, exciting faces. As a teacher, I know how to motivate students.
They started saving January 3. On March 3, I sat down in my table, got my laptop and recorded the amount of money they were able to save. By the way, I asked them to bring their savings, hard cash. After everybody presented their savings, I sum up the amount using excel.
I can't believe what I saw. The total savings of my students, about 45 of them, was a whooping 110,000.00 pesos. It was a miracle! How come these students who at the beginning said their allowance was not even enough were able to save that much in just two months?
Here's the secret. Ready? Do you want how the miracle happened?
No. It was not a miracle.
Before they start saving I gave them a very simple assignment when they go home that day. I asked them to write all their expenses in a week using the table below. After writing all their expenses or where their money goes, they will check on the other columns if they belong to a need or want.
My definition to a want and a need is very simple. Need is anything you can't live without like food, clothing, shelter, etc. Want is anything that can either be there or not. It is something that will not let you die without it.
I then asked them on the following session what they discovered. Well, as expected, they discovered that they have wants. I said, "If you can sacrifice some of your wants, there's no reason you cannot save."
That's all! My students followed.
Now, what about you? If you are still having trouble setting aside from your income, do what my students did. Copy the table above and list your expenses. Be honest of identifying wants and needs.
This simple exercise could change your life.
So, the first lesson on savings is to sacrifice some, if not all, of your wants.
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