Savings is a Bill!

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I’ll be the first to tell you that I have some quirks. For example, I have to write out a to-do list every week, my office desk has to be clean before I can go home (I throw stuff in drawers), and seeing a lot of unread emails causes me a lot more angst than it probably should. Another one of my quirks is that I cannot stand unpaid bills. Paper or electronic, if a bill comes in, it gets paid that very day (unless I’m on vacation or seriously ill). Maybe you’re not quite as crazy as me, but if you’re reading this post, I trust you pay your bills pretty promptly, too.

My wife and I are also pretty good savers, but even I must admit that my love for saving money pales in comparison to my hatred of unpaid bills. That’s why when I heard about a new approach, or more accurately, a new twist on how to think about saving, I got excited. The twist is this: What if we viewed savings as a bill?

When the power bill comes in, I pay it. When the mortgage statement comes in, I swear, and then I pay it. When my wife’s credit card bill comes in, she pays it. At the end of the pay cycle, or month, or year, we usually have a little bit more income left over than we have expenses, so we try to save it, but that doesn’t always work out. Luckily, my wife and I have been blessed to have enough coming in to be able to save a little, but we also have to constantly work at being disciplined and diligent enough to save. Even though we’re pleased with our savings efforts, at times, we could do better, and I bet viewing our savings as a bill would help.

The “savings is a bill approach” is not earth-shaking, and it’s certainly not complicated, but if you or your family are struggling to save enough to meet your financial goals, or to save at all, I’d recommend you try this tweak. If savings is a bill, it comes out at the front of the pay period, not at the end. If savings is a bill, it’s a regular expense and must be viewed as a recipient of part of your income pie, not just the residual crumbs. If savings is a bill, I bet you and I will both save more, and more regularly.

Sorry, but I’ve got to run. The water bill calleth!

-Tom