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Has Saving Up Become a Lost Art?

March 6th, 2011 at 02:09 pm

On Sundays our local paper prints a syndicated column by Steve Batie of Houseworks. Usually his columns are about home improvement projects or woodworking. I'm not very handy around the house and woodworking -- let's say I'd prefer not to increase my insurance premiums, but I enjoy his writing style and his well measured sarcastic remarks.

Today he wrote about people saving up for things. He said he thought most folks don't. I would have to agree. Saving has almost become a dirty word to many -- why save when you can have it right now???

I emailed him to thank him for his column, but also to say we are considered odd in our circle of friends -- we save money in a Christmas Club to buy presents come Christmas time. We have a vacation fund where we save up for a trip or two. Last year I used a small savings account to save up for a new stove. When we say we do these things, people look at us like we've sprouted antennae and we are aliens. Why not buy now and pay later? Or, put it on a credit card?

Other than big purchases than a house or a car, we like to save up for things. We did have money for downpayments on both, but that's another story.

Part of it has to do with the anticipation of actually buying something and truly owning it. It isn't an impulse buy and often something we regret. I really enjoy my new stove. I thought about it, researched it, looked at different stoves, and when I finally had the moolah to purchase it outright, decided I deserved the pleasure of owning it. It's mine and I use it and enjoy it. I'm not worrying about it being repossessed. I'm not doing without something else because I purchased it.

The same thing on a vacation. A friend of ours borrowed against his house so he could afford a vacation. I'm thinking to myself, let's see, you don't have the money outright for this trip, so you are going to borrow against the equity of your home to take a trip that when you get back, you will have to worry about paying the extra bills. Somehow, I would have trouble enjoying the vacation.

Granted, there are certain purchases you have to buy because of safety reasons. If I needed a new furnace and it was freezing outside with no thaw in sight, I'd say do what you need to do. But, to purchase an item that you want and then worry about having to pay for it later?

I think in very simplistic terms, the whole idea of not saving is what has gotten our economy in the mess it is in. In general, the Great Depression of the dirty thirties was brought in part by people buying things on credit where they didn't have the money to pay for it. They overextended themselves and eventually it hurt everyone. I think this last recession was a repeat (remember the slogan about those who don't remember the past are doomed to repeat it?) of that same story. People were buying more house than they can afford and suddenly when it came to crunch time, they couldn't make the payments. No money was being paid and suddenly lots of people were losing money. Excuse me, since when has it become a right for everyone to get exactly what they want immediately?

A friend of ours thought I was nuts when I suggested they make sure they had 20% to put down as a downpayment on their house. I received this comment that it would mean they couldn't buy or couldn't buy the size of house they wanted.

I guess I'm old fashioned -- I think that people are more responsible if they have a stake in whatever they are purchasing.

Although most of the folks on this site are committed to saving, I think we are select few. I say we need to make saving money a goal for everyone.

8 Responses to “Has Saving Up Become a Lost Art?”

  1. Looking Forward Says:

    I want a vacation - see my last post Big Grin - but I would NEVER think of borrowing against my house for it. That is wild! I can't beleive it!

  2. creditcardfree Says:

    Well said. This is the first time that we are working on have a very large downpayment on our next vehicle. It feels really good to save up. We do the same thing for vacations. It is super nice to return home to zero bills.

  3. MonkeyMama Says:

    To take it to another level, I don't necessarily agree with the mass definition of "emergency," either. If my furnace broke, I have the cash to pay for it. I wouldn't even use my emergency fund, because it is a given that all your appliances will need replacement at some point. NOT emergency. (I suppose I could see borrowing if something like a furnace went out really prematurely - or calling it an emergency). But, that said, how many people replace their appliances when all they need is a simple repair? We live in a throw away society. I know people who rather buy a whole new car than replace something as simple as an alternator or a belt. IT's ridiculous!

    I was just pondering on that one because our fridge stopped working and we called a repair guy a few years back. The filter on the bottom/front needed cleaning. That was it. IT was making a funny sound the other day so we got out the vacuum and cleaned it up. Wala. Good as new. 99% of the people I know would have bought a new fridge on credit. Since it is one of the most expensive items I have ever bought (THE most expensive besides our car and home???) and we paid cash for it a decade ago - I am not inclined to buy a whole new one until I am sure it is useless and dead. You treat your purchases differently when you save and wait to pay cash - that is for sure.

  4. Joan.of.the.Arch Says:

    Isn't that the truth? Supposedly, the savings rate of average USAmericans has doubled in the last 2 1/2 years, but neither do I hear that "saving up for it" phrase.

  5. ceejay74 Says:

    A few years ago I would've been the one giving you a weird look--the only time I ever paid for a vacation in cash before 2007 was when I got a big bonus from my job. Oh, and when I was in college I worked all summer to pay for a trip. But after that until 2007, I was all about the credit cards. Couldn't see any way out of it.

    It IS possible to change--now I wouldn't dream of using credit to pay for anything other than house, education or possibly a car someday. Actually, I just put a trip on my credit card, but only to earn points--I have the cash in the bank to pay the card off right away! Wink

  6. Tightwad Kitty Says:

    Call me very old fashioned. I like to pay for everything with cash including cars. If I can't pay cash then I can't afford it. I only have bought two cars and both for cash and still drive one. I did pay for my house in two payments as I was only paying my sister her half and had the money in the bank. I am still debt free and on aged pension now. I save for everything I buy from toothpicks to a house.

  7. ceejay74 Says:

    Yeah, honestly I hope never to take out a loan for a car. I would buy way-used before I did that.

    With a house it's a little different because we'd have to pay rent if we weren't paying a mortgage. We probably pay what we would in rent on the interest and property tax (about $800), plus $400 in principal, each month. If we were renting for $800 and saving up $400 each month for eventually buying a home, it would be about the same except we wouldn't be getting a tax break on the $800 (and we wouldn't be living in our own place).

    Oh, and we wouldn't be able to rent nearly as nice or big a place for $800. It would probably cost our entire mortgage payment to get a comparable place, so then we wouldn't be able to put any of that money toward saving up for a house.

  8. rob62521 Says:

    I would say that we are old fashioned, but far more ahead than most!

    Monkey Mama -- you are so right -- who fixes anything? It's like, let's throw it away and get something else. I was thinking about that the other day when I was mending my quilt that I use as a blanket and bedspread. Most folks would head off to the store and replace it.

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