Saving Change?

Do you save and roll change? I do, and I deposit it into my checking account. I know some people who use this as a vacation fund.

I think I've mentioned it in another thread, but I'm amazed that people use the machines that charge you to process your loose change.

Believe it or not, saving change is one of the most offered suggestions on saving money. Chances are excellent if you saved your change you would have close to $30 at the end of the month. Let's assume you only have $20 instead. Let's also assume you invest it every month and you get a return of 7% annualized.

How much would you have at retirement? I'll let you do the math on any financial calculator you wish.

Keep in mind, if you actually did this, the amount at retirement would be over and above all of your other retirement checks.

We put ours in a giant pickle jar and take it up to the bank 2-3 times a year to deposit.  They have machines to count it and don't charge a fee for it if you have an account with them.   It usually ends up being between $250-300 each time. 

Here's an alternative way to not only save, but increase the amount of, your change. Take a coin purse with you when you go out. Instead of giving into and buying the temptations, cookies, candy, soda, etc., you encounter in your outing, take that same amount of money and put it in your coin purse.

I would bet at the end of the month you have quite a goodly amount. Around here, a soda is anywhere from one dollar to one dollar fifty cents, cookies are all a dollar a pack and candy bars come in at fifty cents and up. If you are a normal snacker, you "bite" on two candy bars and two or three sodas at minimum per day.

Do the math. After you count up your loot at the end of the month, you'll have a decision. You'll have to decide if you will put the money into a savings account, pay down a bill, or spend it outright.

Remember, this is free money so the usual "you have to's" don't apply. Only your common sense is on the line. Act accordingly.

These are excellent suggestions and they remind me of people who have a daily Starbucks beverage.

They could drop that perk and save a quite a bit, or buy from a less pricey coffee shop and still save a considerable amount.

 

Ricardo, I don't have a daily Starbucks beverage - too expensive. I do buy a cup of coffee at my fitness center though after I finish my workout. Costs me a buck but it benefits the hospital at which I had open heart surgery. Knock on wood everyone is extremely pleasant there so I don't feel bad about spending the dollar.

I keep a change jar on my fridge. When it's full I pay it directly onto the mortgage. Do a google search for a mortgage lump sum payment calculator (or I found a good one here http://www.infochoice.com.au/distributions/10202/lumpsum_repayments.asp ) and add in that small payment.

If you pay $200 lump sum from your change jar off a $150,000 mortgage after one year at a 7.25% interest rate, then you're saving potentially $1,424 in interest!

That's worth more than just change in your pocket!

Wow...I didn't realize $200 dollars would have that much of an impact on the amount of interest saved on a mortgage. This is great news and something I intend to apply right away. Thanks!

There's some great advice on this thread - it's like acorns and oak trees - from small things big things grow. If I'd said no thanks and not bought another drink when I was out drinking when I was younger, I could have had two houses by now. If Id stayed at home and not had any drinks, I would never have hooked up with my husband though, so sometimes good things can come of spending.

My mother keeps high value coins and doles them out to her grandchildren. Most of the kids then spend the money on rubbish though, I bet, I know I would have. Now, if any gift money comes my way it goes into debt reduction or saving, no questions. I'm learning!

Indeed, these are all great ideas. Some ideas that I give about it, is if you have a lot of change, have separate jars and put coins into the ones that maybe needs more attention then others.

What I have done in the past, is have envelopes for bills and savings and things - I had electricity envelope, registration envelope etc.. Put so much in them of my pay each month (those are things that you don't have to pay each week) Then I had a savings jar for a dishwasher, and for a new fridge, so I divided up my coins into them, I then went and put them in the bank, but got them to calculate them both separately, so I knew how much I had saved for each, and didn't touch that savings, until I could buy them objects.