Developing a Savings Plan

There are always going to be those fortunate few who inherit large sums of money, win a lottery, get a nice settlement form a lawsuit, or otherwise come into a sizeable sum of money all at once. However, most simply have to accumulate investment capital through old-fashioned thrift. The person who waits for the big score in order to have money to invest will probably never have any investment capital.

Thrift is a combination of smarts and discipline - but mostly discipline - that leads to a habit of spending less money then you make. Do not get discouraged because you are only able to save small amounts of money on a regular basis instead of large chunks at a time. For those who have been in the habit of spending more than they make and going deeper and deeper into debt, changing their spending habits to allow for even a modest amount of savings is a major accomplishment. Also, once people who have not been savers in the past start to accumulate some savings, they usually feel so good about their accomplishments that they are encouraged to do more. Even a fairly small, but regular, savings plan that is supplemented by windfalls, such as tax refunds or bonuses form employers, can result in a significant accumulation of money over a period of time.