By coinnews 
00:00 Speaker A
According to a recent Gallup poll, Americans’ top economic concerns are high cost of living, the cost of their home, and not earning or saving enough money. My next guest has several ways consumers can find ways to save despite economic uncertainty. I want to bring in Lawrence Sprung, who is the Midland Financial founder and author of Financial Planning Made Personal to talk through some of the ways consumers can save as part of our saving series brought to you by Synchrony. Great to have you back in studio with us, Larry. Let’s just start with the basics. How can people build an emergency fund?
00:44 Larry
I think it’s so important to start building that emergency fund, and I think one of the best ways to do it is automate it. The things that we automate get done. So, whether that’s taking money directly out of your paycheck into a separate account or moving money from one account to another, super impactful. Naming those accounts are just as important, too. Name it emergency fund and you’re less likely to dip into it unless it’s an emergency.
01:14 Speaker A
How and why should you be automating your savings? That’s something that you alluded to just a moment ago.
01:22 Larry
Yeah, well, think about it from the, you know, the retailer side, right? Everybody loves subscriptions because we sign up for them and we forget about them, and we hardly ever cancel them, right? So, do the same thing with your savings. If you automate it, you kind of forget about it, you start building up that savings, and you’re now helping yourself in instead of on the expense side of the equation.
01:55 Speaker A
I need one of my subscriptions to trick me and just say they’ve been putting it into account the whole time that I can activate a little bit later on. You know, as you’re thinking about monthly expenses, how do you know where you can make some of those strategic cuts?
02:13 Larry
Well, I think the important thing is first go through your expenses overall, look at them. Are there things you’re not using? Like these subscriptions we get rid of them. Get rid of them. Then look at things that are potentially not bringing you any joy and perhaps eliminate those as well. And then those necessary items where you may be a long time customer of that company, call them. Maybe you can get like an introductory rate as if you were a new customer and reduce your expense significantly. We’ve successfully done that with cellular phones, alarm companies, cable, etc. It’s been very successful in reducing those expenses.
03:01 Speaker A
What about debt? If you have debt, why is now a crucial time to pay it down?
03:10 Larry
Well, interest rates now are significantly higher than where they were, for sure. And more importantly, I mean, credit card debt, there is a difference between good, bad, good debt and bad debt. I would say credit card debt is the more problematic, higher interest rate. So, it’s really important that if you want to increase your savings, you got to cut your expenses, and one easy way to do that is to start paying down those expenses, those those debts, so that your interest costs go down, and you have more money to save to those other areas you’re looking to save for.
03:57 Speaker A
Is there an easier method to try and deploy? We know about the snowball, the avalanche methods. Which one do you see most commonly topped?
04:07 Larry
The one that you’re going to do, the one that you’re going to use and use on a regular basis is the one. Just figure out a way that works for you. Are there pros and cons to each of those methods you just mentioned? Absolutely, but at the end of the day, if one, the better one for you, you’re not going to follow, it doesn’t make sense. Follow the one that you’re going to be able to execute on and continue with.
04:34 Speaker A
How can consumers practice mindful spending here? This is something that especially as they’re looking across economic prospects, whether that be employment, or whether that just be going through their own expenses and pulling back that they’ll start to deploy, and they’ll start to put into action as well. What is mindful spending on aggregate?
04:59 Larry
So, I mean, we’re always inundated with things that we could potentially purchase, and sometimes those might be good, sometimes maybe not so. So, at the end of the day, you have to look at the mindfulness of the spending, look at that potential purchase, and perhaps take 24 to 48 hours before you actually pull the trigger on making that purchase, and see if it’s something you still want to buy.
05:27 Speaker A
And so, as you’re thinking about some of the different generations, and what we’ve typically been able to do to monitor our own spending, how how are tools today different than those of years past, perhaps when we were balancing a checkbook, or having a different type of ledger versus the technology that’s available to make sure that you’re keeping on track with these goals?
05:50 Larry
I think the tools are very similar. We’ve just gone from more of a pen and paper methodology to more of an electronic methodology, and it’s just something that you have to do, keep track of, and make sure that you’re staying on top of, so you’re staying within the confines of your budget.