I recently started the spending fast and have a quick question: Dave Ramsey suggests putting aside $1,000 in savings at the beginning. Do you also recommend this? I don’t really have any savings, so this might be a good idea.
Savings vs. Debt Dilemma
Dear Savings vs. Debt Dilemma,
I know this is not a popular way to think about savings accounts but I’m giving it to you straight. I didn’t put money into a savings account during my Spending Fast. The only reason I didn’t put anything into savings is simply because I couldn’t keep it there. I spent all the money I had, whenever I had it. Any “savings” would go into my account, then slowly but surely it would dissolve away because I would spend it on little expenses here and there. Plus, I wanted to get out of debt ASAP—and putting money into savings would’ve slowed down that process. My thinking: throw all the money at the debt to get out of debt super quick, then throw money into savings until the desired reserve has been met. Then focus on investing.
What are your thoughts on savings accounts? Can you keep money in savings or do you always end up spending it?
P.S. Check out 26 ways to Kickstart Your Inner Cheapskate
P.S. Ready to get out of debt ASAP? Check out the Spending Fast Bootcamp!