Building Your Pot Of Gold

Imagine you are walking in the woods and find a pot overflowing with shiny gold coins at the end of a rainbow. Pretty cool, right? Imagine how secure you would feel about your 

future, knowing that all the gold in the pot was at your disposal to spend however you want. Leprechauns and pots of gold may not exist outside of folk tales, but the reality is just as good. You can build your own "pot of gold" that will make your future bright and give you a wonderful feeling of security. The key is to save on a regular basis. Over time, small amounts of money will add up to a surprisingly large "pot." Add in the interest that accumulates over time, and then the interest paid on the interest, and one day you may have enough for a down payment on a new home, a good start on a college education fund or on your retirement fund.

Thinking of the Future

Even if you are facing financial challenges right now, it is still worth it to make plans for your financial future. It may seem difficult to juggle paying down debt while also saving money at the same time, but you can do it. It will get easier with practice.

• When you begin saving, start small. The most important thing is to establish the habit of saving. Later, as you get rid of more of your debt, you can increase the amount you set aside for savings.
• Make saving as easy as possible. Check with your employer or your bank for ways to use technology to make saving automatic.
• Think of saving as paying yourself first. Take a small amount out of every paycheck before you use the money for anything else.
• If you get a raise or cut your expenses, don't just spend that money on something else. Earmark at least some of it for your savings accounts.

Here are some things worth saving for:

Emergency Fund. When you start saving, the first thing you should focus on is creating an emergency fund. That will tide you over if you have unexpected expenses or an unforeseen loss of income, and it will keep you from having to take on additional debt to deal with the emergency situation. Some experts recommend having enough money in the fund to cover three-to-six months of living expenses. If this seems overwhelming right now, then start small. You could start with a goal of $500. Once you achieve that, then aim for the next $500.

Your Children's College Education. Setting up automatic deductions is a good way to save for a college education as well. The earlier you start saving, the better. If you start when your children are very young, your money will have plenty of time to compound and grow. There are special accounts you can use to save for a kid's college education that offer tax savings and other advantages. One of the most popular type of account is called the 529 college savings plan. A good strategy is to invest the money in stocks when your children are young so that the money will grow faster. Then, as the kids get closer to college age, switch to investing in bonds, which are less risky. Many of the funds will handle this switch for you automatically, based on your children's ages.

Saving for Retirement. Do you have a retirement plan at work where your employer will match your contributions? If so, putting money into the plan is one of the smartest financial moves you can make. Your employer's contributions are like free money, just like a pot of gold in the woods, so make sure you get your share. Just like saving for your kids' college, saving for retirement is a project where time is definitely on your side, and the sooner you start saving, the better off you will be in the long run.

Save Money by Cutting Expenses Without Feeling Any Pain!

To find more money you can save, try cutting expenses. To do that without feeling deprived, ask yourself two questions whenever you are making a purchase or paying for a service:

1. Do I need this? If the answer to that is "no," then ask yourself...
2. Do I really want it? If the answer to that is "no" as well, you can stop buying the item without feeling like you are missing out.

Take that money you save, and put it into one of your "pots of gold." Saving for the future is a gift that you are giving to yourself and your family. Who needs leprechauns when you have the power to create a future where you have the things you need, and the peace of mind that comes from feeling well-prepared and secure.