Start Saving with Some Sensible Talk

Bill Staton, co-author of Worry-Free Family Finances®, is interviewed by the Times Union (Albany, New York), May 15, 2005

How do money-smart families maximize their cash without being cheap? Here are some tips from families themselves and Bill Staton, co-author of Worry-Free Family Finances.

Talk about money - nicely. "We've never had a fight about money that I can remember," says Gerard van den Dries, the dad behind our most money-smart family. That's because van den Dries and others like him talk sensibly with their spouse and kids about their finances.

Emily Duron, part of another nominated money-smart family, says it's good to be on the same page when talking finances, as she is with her husband, Manuel. That means an open chat without criticism.

"We really don't argue about money that much," Emily says, "because he knows when I say we're broke we're not really broke - we just haven't saved as much as we wanted to."

Make financial plans. After you put your money where your mouth is, Staton says put it on paper. Writing financial plans helps realize them. "Not on a computer but handwritten," Staton says. "We think it's more powerful that way."

Invest in your future. Retirement planning is a must. Emily puts cash toward her retirement account while Manuel chips in to his 401(k). The van den Dries have Roth IRAs as well as 401(k) and 403(b) accounts, plus college accounts for their two kids.

Use coupons. Lynn Bradshaw may have a strong affinity for the supermarket chain where her husband is director of pricing, but just the same, "I have been known to turn around and not go (there) if I don't have my coupons," Lynn writes. Her coupon compulsion also goes for dry cleaning ("I save $520 a year by using one coupon a week," she says), oil changes, and haircuts for the kids.

Save to give. Charity begins at home for the money-smart family. Staton notes that setting aside some money for charitable organizations is critical to everybody's financial plan.

"We all have to help each other," he says. "We believe as our incomes go up, we should be able to give more and more to charities or universities or whatever it is we want to give to."

Nancy Powell, a retired math teacher, recommends setting aside 10 percent to 20 percent for savings and another 10 percent for charity, then use the remaining 70 percent to 80 percent for the necessities.

Not that that's stopped her and her husband, Therrell, from having fun. "We've done a lot of traveling, beaucoup cruises," says Therrell Powell, 70.

Indulge within reason. Speaking of entertainment, all our money-smart families still find ways to sometimes splurge, usually with an exotic vacation. The key is planning and paying with cash whenever possible.

Duron takes an annual summer trip with a girlfriend. (They save with frequent-flier miles and bunk with friends.) She and her husband also save each month for a family vacation. The van den Dries family has been to Mexico and Belize as well as Hawaii, Southern California and Las Vegas. They've even trekked cross-country through Canada.