How to Save Money

So it’s been a busy couple of weeks, hence no post last weekend and some sporadic posts during the week. My Engage case study is coming to a close, and I’ve been working on a lot of things. Busyness isn’t really an excuse, but it’s giving me some good perspective on the things that are actually really important to me, and one of those is these posts. I like having a space to just sort of ramble and be me without having an agenda, like communication, gaming, or philosophy.

My Katy Perry cover last week was a lot of fun to put together, and I’m looking for ward to playing around with some other pop songs, though my musical tastes are a few years behind the times. Links to that and other things past the jump. But the thing that really hit me in the past few weeks was how I learned to save money.

I grew up poor, not living on the street poor, but there were times when we were at risk. We did everything we could to stay afloat. There were good years and bad years. Everyone has that, and it affects the way you live as an adult. For me, one of the big things was how I think about money.

Growing up, and even as an adult, money wasn’t just a resource, it was life. X was the amount of dollars I had, and Y was the amount I absolutely needed to stay alive, with a roof over my head and food in my belly. I spent a lot of time worrying about situations where X falls below Y. Even if I was doing okay, especially if I was doing okay, because what if I got sick, or got laid off, or a million other things happened? Because money was linked with life, it became a source of anxiety. I always wanted more of it, not so I could get more or bigger stuff, but so I can guarantee further survival. This is not a good relationship to have with money.

When you have this kind of relationship, the idea of saving money means putting it away in a sock drawer, where you can get at it in an emergency. Because what if you need it? I cannot adequately describe to you the kind of fear I associate with this. It is a level of anxiety matched only by my fear of my own mediocrity and that panic that happens when I’m talking to a girl who might not just like me, but might like, “Like like” me. I really wanted to say “Spiders” there, but spiders are actually pretty cool. So when you have a lot of money in your sock drawer, you feel good.

But this is not being good with money. It is not saving money. When you save money, you send it away for a while to do things for you, maybe into a GIC, or an RRSP, or even just a savings account, and you pick it up again in a few years (sometimes a lot of years), and there’s more of it. Academically, I know this. I’ve read lots of books on it, and I understand the idea of doing this. But there’s still that gnawing feeling of “But what if I need it? What if something happens?” It’s really hard to get around, and it clouds my thinking. Then a friend of mine, who’s good with money despite (or maybe because of) growing up the same way I did, gave me some really good advice.

“Pick a number.”

Pick a number that keeps me alive for a comfortable amount of time. A number that I feel comfortable with having stashed in my sock drawer or bank account or whatever. Every cent that I make over that number, sock it away into real savings. Use all those things I learned in books, and work with experts, etc. This way I don’t have to be afraid about it. I’ve got my number on hand, my float. But I’m also saving money like I should be, and preparing for twenty years down the line, rather than worrying about how I’ll survive the next month (which is, at the moment, a completely unfounded worry. I’m not about to fall below Y amount and expire).

That’s what I learned this week, and I wanted to share it because it seems like a really big deal. How do you think about money?

This week I made some videos about how my mac and cheese gives me hope, and covered Katy Perry’s Firework. Over at TPK, I dissected a few more pieces of the 20 Question background, and on Laybrinth I talked about promoting events and how getting together in university can relieve stress.

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