Deciding on a Spending Fast “Saving” Strategy

Pay Down Debt or Build Up Savings? |

Hey, Anna!

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!


7 thoughts on “Deciding on a Spending Fast “Saving” Strategy

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  1. Jane


    I agree with your take on savings. The interest one pays with a credit card or other debt is so much more usually than any amount saved. In effect, building a savings account while you are paying debt with interest is actually losing money.


  2. Kyla H

    I think having at least a small amount of savings can help so that you don’t go further into debt if an emergency arises. Ex. if you’re trying to get out of credit card debt and your car breaks down, those expenses are likely going to end up on your credit card if you don’t have an emergency savings, thus prolonging your time in debt and possibly even increasing the amount of interest you pay in the long run!

  3. Dee

    I agree with Jane and Anna – you need to weigh up the cost of the interest you’ll be paying on your debt verses the interest you would be earning in your savings account.

    I’m not sure about where you live, but currently in Australia the very best high-interest savings you could get is at about 3%, if you have debt on an 18% interest credit card, it makes no sense to keep money in a savings account when it can reduce the debt on that high-interest credit card or personal loan.

  4. chris

    But think of it this way. The money in a savings acct can prevent more debt if you run into expensive issues like car trouble or washing machine breaking.

  5. Susana


    I did the 1k savings before paying off my debt and I whole heartedly recommend it. There were several times where I needed the money to pay off an emergency. Having the funds set aside allowed me to focus on my big goals rather than feel like I was constantly restarting every time a major emergency happened.
    The other really cool thing about having saved the 1k was knowing that I could put money into savings!! There is a first time for everything!

  6. Abbie

    I did a little of both. I opened a savings account (in a completely different bank than my regular accounts) that gave me increased interest if I didn’t pull money out for six months. I did it all online — out of sight, out of mind! I followed the 52 week saving plan in reverse — $52 the first week, $51 the second week, and so on — and set up automatic withdrawals from my bank account. This way, it all kind of happened without me even paying attention. I also have a certain amount pulled from my checking to my regular savings every month, as an additional cushion. Once it hits a certain amount, the overage goes to my debt. But that second savings account has been key for me. We’ve put away so much already just in case an emergency happens WHILE we’re paying down debt. This past fall, it was devastating to have our card almost paid off, only to realize my hubby’s truck needed major repairs AND new tires. Our only option was putting the charges on a card. I felt like it was one step forward, three steps back. So, for me, it’s important to do both… just for instances like that!

  7. Raquel

    Thanks for this guys! Its really helpful. I’ve been struggling whether I should keep my emergency fund while im getting out of my credit card debt.

    I think its still wise to put a little away for an emergency fund because you’ll need a source of ready cash when disaster strikes–and when you’re getting out of debt you don’t want that to be your credit card!


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