Why Money Matters

Rubbing Pennies started as a personal challenge to save $10,000 in one calendar year. As a young couple, we (Ian and Jen) know how important it is to live within your means, avoid acquiring a lot of debt and have a healthy financial cushion to fall on in case of emergency. On April 10, 2010, we set out on the journey of marriage with two steady incomes, a newly purchased home, one vehicle payment, and a very modest savings account. In an effort to beef up our piggy bank, we launched Rubbing Pennies in January 2012. This is our story of how we love the life we live, and how we can afford it.

Tuesday, February 7, 2012

Fluff in Your Bank Account

   Exciting news: By applying all the savings strategies in January that we blogged about - packing your lunch, dining in, the fiscal fast, mani/pedis at home, date night on a dime, traveling cheap - we were able to cut our credit card bill in half! In. Half. Understanding that our December bill was on the high side because of Christmas anyway, we were still able to get it down several hundred dollars from where it is on average. After paying all our January bills yesterday (utilities, cell phone, etc.) and anticipating Ian's truck payment that will be due before our next payday, we have about $300 "fluff" in our checking account.

   What is "fluff"? It is good money management to have a base number for your checking account. A number that you don't ever want to go below, so that you have emergency funds available. Set that number for yourself and make a commitment that you will keep at least $X in your checking account at all times, unless it's an emergency purchase. Shoes on sale do not count as an emergency. Anything over that base number is the "fluff" in your checking account. 
   Today, I'm taking that $300 fluff, and transferring it into the savings account. (See savings ticker).  
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