I read an article on CNBC the other day that began, “Most people in the U.S. are living in financially precarious circumstances. Half of all Americans have nothing put away for retirement and the vast majority of them have under $1,000 saved, total.”
After reading the article, I wondered what percentage of the population knows how to swim. The American Red Cross took a survey several years ago determining that, “More than half of all Americans can’t swim or perform basic swim safety skills.”
Are you in either of these sections of the population? Are you in both? Regardless of your financial or swimming situation, you have the ability to learn to save and swim. Both skills take effort and practice, but both are achievable by everyone and both are equally rewarding.
Learning to Swim
I used to have a part-time job teaching water aerobics. One day a member of the health club asked me if I also taught swimming lessons. Being an enterprising young swimmer, I told her that I do and asked whom I would be teaching. She explained that she and her husband were taking their son to Disney World in three months and asked if I could teach him how to swim. She then informed me that her son was afraid of the water. I told her I would teach him to swim before they left for vacation as long as she brought him to me each week for lessons.
The first lesson arrived and it was all I could do to coax the young boy near the edge of the pool. During the first lesson, I managed to get him to sit on the side of the pool and dangle his legs in the water. Now I am coaxing you to trust in my advice. No matter how many bills you have, no matter how much money you do or do not make, I tell you right now that you have the ability to save money.
At the second lesson, I managed to convince him to step down into the pool. He walked around the shallow end, but would not put his face in the water. Your second lesson is to locate a place to put your savings. I recommend somewhere that is not your local bank. Why do I recommend an alternate bank? This is a savings account. That means you do not spend the money you put in it. My current favorite place for my savings is a High Yield Savings Account with Synchrony Bank. Having your savings in a place out of sight from your normal accounts where you cannot quickly withdraw the money will help with your savings. You will also earn 1.15% APY (Annual Percentage Yield) on this savings. How much does your bank pay for savings accounts? The national average is roughly 0.12% APY.
I was able to get the boy to put his face in the water and blow bubbles during our third lesson. For your third lesson, I want you to decide on an amount each time you get paid to transfer to your new account. What are you waiting for? Decide on an amount already! It can be as little as you want to get your feet wet. If you work at least 40 hours per week, I recommend beginning with the amount you make for 1 hour of pay every two weeks.
By the fourth lesson I managed to get this brave little boy to hold his breath and duck his head under the water. I also began teaching him the fundamentals of a basic crawl stroke. His mother could not believe it. What do I believe? I believe you can set up an automatic withdrawal from your checking account the day after each payday to deposit an hour of wages into your shiny new high-yield savings account.
From the day that I was able to get this boy to feel comfortable with the water it was only a short time to get him to swim. Each lesson he made more and more progress and lost his fear of the water. Once you begin automatically saving an hour of wages for yourself, you will find that you have no less money than you had before. Your fear of not having enough will vanish. This is a strange thing about money and our thoughts about it. When it appears that you have less money with which you have to use, you will find a way to use less and you will be no worse off than you were before. You will manage to live on that 1 hour less per paycheck just as if you never had the money in the first place.
The boy’s mother wanted me to teach her son to swim so that when they were at the resort he would be able to enjoy the magnificent pools the resort offered. After their vacation, she told me that when she, her husband, and her son went to pool at the resort for the first time that their son jumped in and swam to the other side. Her husband turned to her and said, “Is that really our son?” For all he knew his son was still afraid of the water. Whether it is saving or swimming I know that you can learn to do either with enough dedication and persistence.
I want you to save your money so that together we can lower this statistic. I want you to save for your future. I want you to save so that you have security when life goes astray. Once you begin saving and you see the money add up month after month, year after year, you will begin to have great pride in what you accomplished. Hopefully, as time goes on you will be able to increase your savings beyond an hour per paycheck, but that is a great start.
If you already have an automatic savings account and you are learning to swim, it just takes some lessons and one stroke after another to keep swimming.
Let me know when you get started!
Yours in Saving and Swimming,