save money just because

June 16th, 2008

Save Money Just Because

When I started my first real job at 14, I didn’t have many expenses. I lived at home with my parents, I wasn’t old enough to drive, I didn’t have a significant other (yet) to spend money on. So I saved the vast majority of my earnings. Although I instinctively enjoyed the idea of saving my money (my brothers, on the other hand, called it hoarding), I thought I needed a purpose for saving. So I gave the money a specific purpose, and saved my money to buy a car when I was old enough to drive. And that is exactly what I did with it.

Now I am not trying to claim that money shouldn’t be saved for specific purposes. But the idea that was missing from my financial vocabulary was the idea of saving money “just because”. I now have an emergency fund, and although there are a lot of things it could potentially be used for, it doesn’t have a specific purpose preassigned to it. I save it just because. Just in case I need it. Just because some money should be saved. And hopefully, at some point in the future, I will save a very large amount (to me) of money, between $15,000 and $20,000, just because.

This is a very new concept for me to embrace. It was a hard thing for me to wrap my head around, this idea of saving money with no specific preassigned purpose for it other than to be there in case it is needed. And certainly, the idea of saving a large amount of money with no absolute and certain predetermined assignment is still a hard one for me to completely embrace. I’ve never had a significantly large amount of money saved for anything, especially not one that was five figures. I don’t think I have ever had a bank balance with five figures before, and our retirement savings is currently barely into five figure land. The idea of saving that much money without knowing exactly what it will be used for is a very strange concept to me indeed.

But if I have learned nothing else over the past year of blogging about my finances, I have learned to expect the unexpected, and that being prepared is a much better alternative to being unprepared for what life may bring. We’ve weathered a few financial challenges, and the one where we were prepared to handle the difficulty without turning to debt was a much smoother and less traumatic ordeal than when we had no idea how we would get through the difficulty.

I’m an emergency fund believer, a convert, and an embracer of the just because mantra. And we will continue to save money, slowly but surely, just because.

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8 Responses to “Save Money Just Because”

  1. Having a lump sum “just because” and not allocated to any goal creates a lot of freedom like the freedom to leave a job you hate. It gives choices and just seeing it in the bank gives you the fun of feeling rich. As the amount accumulates so do your options. Best of luck with the future savings.

  2. My post today is about saving – and how it can be hard to get motivated to save sometimes if you don’t have a goal. My suggestion was to setup a savings goal, and then act as if that savings goal was a high interest debt – paying it using the debt snowball or other similar technique.

  3. This was a hard concept for me to get as well. I had always been able to save for something and would frequently have money in the bank. But to have money in the bank with no purpose? That was weird and for a long time it was a constant temptation to spend it, to give it a purpose. I think I am past that now finally, but it has taken a few years. I am now used to having money in the bank and saving it for no reason. Now I wish I had more though.

  4. I’ve had a tough time with this one, as well. A few years ago I would have said that saving just to save was uninsightful – that the purpose of that unspent money was to do the things you love. Now I see that, as an earlier commentator wrote, that unpurposed money is really buying your freedom from difficult situation. And I love freedom more than I love donuts.

    Now that I think I’ve abused the prefix “un-” sufficiently, I’ll close :)

  5. The peace of mind that you get from having “just because” savings is wonderful. I love having savings that is not earmarked for something. It gives me such a great feeling.

  6. I did the same thing when I was 14. But I was saving for college. I wish I could have put all that money for a car or something. If I didn’t have to pay for my college, I could be driving a new paid for vette right now. :)

  7. Perhaps you can name it your “Anti-Debt Fund,” because that’s what it is. It’s your insurance against going back into debt in the future when you run over debris in the road and tires on your vehicle are damaged and need need replaced while you are out shopping for that new refrigerator to replace the old one that died right after you had a major power outtage and had just replaced the spoiled groceries…..You get the idea. ;-) It HAS a purpose; you’re just so used to naming sections of a goal while paying down debt (i.e., the credit card, the car loan, the student loan, etc.), so maybe you need to name sections of this fund. Maybe you want to designate $5000 of that as a replacement fund for appliances and furniture that you know have a limited lifetime; maybe $5000 for unexpected medical and/or dental bills; maybe $5000 just for the truly unanticipated “Murphy comes calling” expenses. That would give you a tangible goal and perhaps make it easier for you. Good luck! I can’t wait to join you in being able to set up a similar account!

  8. I call it my Freedom Fund… Freedom to do what I want, or usually, what I NEED to do, without having to worry about going into debt. Just write a check.

    I also think of it as my Peace of Mind – account… and it has carried me over many hurdles, job changes, unemployed, and divorce and starting over. Just having it doesn’t mean I have to use it – but it buys me the Peace of Mind to know it is there if I have to have it!

    And I find it best to have mine tucked away in a brokerage investment account…. I have to ask for it to be transferred from my investments to my money market checking account (no fees) and have a day delay on it usually…. it does stop any impulse uses of it when you have to go thru a few steps to actually spend it :)

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