One of the best stories I hear is of the single mom who learns how to save money and in the process, amasses $1,000,000 by the time she retires.  What makes these stories even better is when you realize that they did it on a salary that never exceeded $55,000 per year.   Here is one such woman, Sherelle Derico, who is in the process of becoming financially independent.  Here is a quote from the article:

“I found myself in lots of debt. That’s when I started to save a lot of money,” said Derico, who now works as senior consultant in project management for Booz Allen Hamilton in the Washington, D.C., area.  The article goes on to say:

Derico has paid off roughly $25,000 in student debt, personal loans, and credit cards debt she racked up in 10 years. She paid for her master’s degree mostly in cash along with matching plans from her employers.  Also, five years ago she started receiving a small amount of child support which is now $700 a month.  As for her own money, Derico puts 20 percent of her income into her 401(k) and IRA.  She says she’s adamant about paying into her savings like she would any other bill. She has $95,000 in an account with TIAA-CREF. Her Booz Allen 401(k) account has $36,000. She keeps about $8,000 in her regular savings.  ”My friends say I’m pretty obsessive [about my savings],” Derico says, pointing out that she ‘loses it’ if her savings fall below a certain amount. (end of quote)

What is the first thing that sticks out about this woman’s story?  It’s her determination and resolve to better her life and put herself first, as if paying herself is like the home mortgage payment. “She’s adamant.”   The habit of saving money  is not about solving your budget, waiting until you get the next raise or some other circumstance.   We all know how to save money.  The habit is only formed when you come to the realization that unless you invest in your self and your future, you will not have anything when you get there.

Saving money needs to become one of the most important things in your life. For example, how much importance do you place on paying the mortgage?  It’s right up there at the top, right?  Well, if you can’t forgo that vacation or new big screen television saving money will never be a reality for you.  You will always have competing agendas.   I am not against buying stuff or fun stuff for that matter.  But………and this is the “key”   It needs to be done AFTER you’ve paid yourself.  Once you’re out of debt and you’re saving at least 10% of your income, buy 2 big screens.

And it’s really not as hard as it seems.  You just need to have order to your life.  Once you actually sacrifice and begin to get into the habit of saving you will see results.  Then, you start to see the possibilities.  I know of someone who is just starting to save money so they can sort of restart their life.  They are off to a great start and have managed to save $4000 this year already (in just under 2 months).  Now, they can see the target of $5,000 and eventually $10,000 a reality.  Where could this person be in 5 years?   You start and you build with small victories.

If you are still struggling with how to save money, you have to ask yourself this “What if your spouse had a rare disease that was not covered by your insurance?  In order for them to get the cure for this disease you had to save $10,000 by the end of this year or they would die.  Do you think you would do whatever it took to save the money?  Of course you would.  You would do whatever it took.

This is the mind set Sherelle Derico has.  This is called “wanting it”  The reality is that a lot of people talk about how bad they want to make it financially.  Yet when it comes down to it, they really do not want it bad enough.  Where are you on this?  Are you fooling yourself and just going through the motions, making excuses?  Or, are you emotionally committed to improving your financial life?  It really comes down to a choice.

Remember – You start and you build with small victories. Learning how to save money is no different.

Related posts:

1. 3 Ways to Save Money Right Away
2. Money’s Dirty Little Secret