5 Ways to Squirrel Away Money
Just as squirrels hoard nuts for winter, we can squirrel away money to get through an economic winter. We share five ways to weather a downturn.
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On this BIGG Success Show, we discuss how to prepare financially for tough times. Here’s a summary of that discussion…
This show was inspired by the many busy squirrels in our neighborhood, conducting their annual march to winter.
Here’s a story of a smart young woman who met a wise old squirrel.
It was a lovely summer day. The sun was shining bright. I basked in its warmth.
There wasn’t a cloud in the glorious, blue sky. There was beauty all around me – the trees, the shrubs, the flowers. I could have painted a picture, if only I could paint!
I caught a glimpse of movement out of the corner of my eye. It was a squirrel burying a nut.
Ah, an unpleasant reminder that winter will soon be here, I said to myself.
Then something odd happened – the squirrel asked:
“Are YOU storing up nuts for winter?”
I was startled. Squirrels can’t talk! I paused …
“I asked you if you are storing up nuts for winter?” the squirrel’s voice rang out again.
I looked right at the squirrel. He was looking right at me, appearing eager for my response. And then I did it!
I started slowly, but I replied, “I don’t have to … I can just go to the store.”
“But I’m not talking about the kind of nuts I store up,” the squirrel protested, “I’m talking about YOUR winter hoard.”
“What do you mean … MY winter hoard?”
“Well, we squirrels know that in the summer months, there’s plenty of food available. But come winter, there won’t be any. That’s why we bury nuts in the summer. If we don’t do that, we won’t have any food to eat over the winter … we’ll go hungry.”
“I know that … but I still don’t understand what you mean …”
“… well, let me finish,” the squirrel interjected, “humans also face winter. There are times when things are good. Think of those as your summer. But there are also times, for one reason or another, when things aren’t so good … you have winter, too.”
“Okay, now I see where you’re going …”
“Yeah, when things are good, you have store up your own hoard – your cash hoard – for the bad times.”
“Because if I don’t do that, I won’t have any food to eat!”
“Now you understand!” the squirrel exclaimed.
That was the only time I ever talked to the squirrel. However, I always remembered our conversation.
From that day on, I always squirreled away a hoard when times were good. And I never went hungry thanks to that squirrel!
This Podcast Episode is Sponsored by: FinancialFreedomTool.com
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How to squirrel away money
1) Live as if the recession already started
This is a critical mindset shift. While times are good, stash away cash for times when things aren’t so good. Build your capital reserves so you can weather unexpected events.
If you’re like us, you find it helpful to think of your household as a small business. Entrepreneurs are excellent risk minimizers.
In this case, that means not just thinking about one unexpected event. What happens if you have two at the same time? For example, a major home repair on top of a layoff.
We have a tool which helps you “stress test” your finances for situations like these. Check out our Financial Freedom Tool.
2) Stockpile raises to squirrel away money
Work to increase your income when times are good. The best time to get a raise is when your employer’s profits are rising. But there are three ways you can go with a raise.
At one extreme – you can spend it all. And more. Like a lot of people do with a raise. Next thing you know, money’s tighter than it was before.
At the other extreme – you can save it all. This is the fastest way to shore up your finances for a recession.
Of course, you may do something in between. How should you decide how much you SHOULD save?
Look to the “stress tests” we talked about in the previous point. If your finances can handle a serious shock, then you can save less from your raise. If it’s sketchy, save more until you get to the point where your finances can take a significant hit.
3) Bank your windfalls
Think of this as “found money” – a tax refund, an inheritance, a bonus.
Stash it all away. A windfall is the fastest way to change your short-term financial trajectory.
However, most people blow it all. Be different – put it away to buck up your finances.
4) Moonlight
Get a part-time job. You don’t have to do it forever. Just do it long enough to build a cash stash.
Think seasonally. For example, a lot of businesses hire for the holidays. You can make money and, perhaps, get a discount on purchases – which may help you stick to your holiday budget.
You work hard for this money. Make sure it works hard for you as well. The more you save from these paychecks, the sooner your finances will be in tip-top shape.
5) Start a side hustle
What expertise do you have? What skills do you possess?
Who would pay you for these things?
Be opportunistic. Get started. It doesn’t have to be your passion. You just need a low-cost way to get into a business. Gain resources. Then keep growing. It leads to BIGG success!
Cheat sheet: 5 ways to make more money
Our goal is to help you get started making more money as fast as possible. In this 1-page cheat sheet, we share the only five ways to make more money. Get your Money-Maker’s Cheat Sheet now!
Here’s to your BIGG success!
George “The Professor” & Mary-Lynn
Co-Founders, BIGG Success
Direct link to The Bigg Success Show audio file | podcast:
http://traffic.libsyn.com/biggsuccess/00993-100119.mp3
