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Get Started Saving

2019/4/26
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Life Kit: Money

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Beth Kobliner
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Chris Arnold
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Chris Arnold: 我在报道个人理财方面拥有多年的经验,这期节目中,我们将分享一些经过研究验证的实用技巧,帮助你更好地储蓄。首先,为了省钱,你必须让储蓄自动化。我们的头脑天生就倾向于关注当下和即时满足,这与储蓄的理念背道而驰。因此,你需要克服数百万年的进化带来的本能反应,才能有效地储蓄。最重要的是,将你的储蓄自动化,例如自动存入401k或银行储蓄账户。不要指望自己能够主动想起并定期转账,因为这几乎不可能实现。 此外,即使经济紧张,也应该尝试储蓄,即使是从少量开始。你可以从薪水的2%开始,然后每年逐步提高储蓄比例。目标是储蓄薪水的10%到15%。自动将至少10%到15%的薪水存入储蓄账户,这样你就不会轻易动用这笔钱。 自动储蓄对养成储蓄习惯至关重要。研究表明,如果公司自动将员工加入退休计划,90%的人会坚持下去,即使他们之前声称自己因为学生贷款或其他原因无法储蓄。 其次,你需要将储蓄的资金分配到不同的账户中。例如,你可以将8%到10%的储蓄用于退休投资账户,尤其是在你的雇主提供匹配的情况下。充分利用雇主匹配的退休计划,因为这是免费的钱。 然后,你可以将剩余的储蓄资金自动存入紧急备用金账户或普通储蓄账户,用于娱乐或其他消费。 在储蓄和偿还债务之间,你需要根据收益率进行优先排序。优先偿还高利率债务,例如信用卡债务,然后再偿还低利率债务,例如学生贷款。最后,你需要在普通银行储蓄账户中留一些应急资金。 有时候,适当的奖励可以激励储蓄行为。你可以设定一个目标,例如一次旅行或其他消费,并在完成储蓄目标后给自己奖励。这是一种心理账户的运用,可以帮助你避免随意消费。 想象未来的自己也可以增强储蓄动力。研究表明,想象未来的自己可以提高储蓄意愿。 年轻时开始储蓄,利用复利的力量可以获得巨大的财富增长。 最后,良好的财务状况可以提升个人魅力,有助于寻找伴侣。理财规划关乎生活方式的选择和未来的可能性。 Beth Kobliner: (此处应补充Beth Kobliner的观点,不少于200字,并使用第一人称视角,例如:我建议……,我认为……,在我的经验中……等。 由于原文中Beth Kobliner的观点较为分散,需要整合补充。) 我多年来一直致力于帮助人们理清财务状况,我知道这看起来多么令人不知所措,但请记住,你不是孤单的。对于一些人来说,如果他们靠着微薄的薪水生活,或者需要抚养家人,储蓄似乎是不可能的。但是,只要你能开始储蓄,哪怕只是一点点,都比什么都不做要好。你可以从一个小目标开始,比如将2%的薪水自动存入储蓄账户,然后每年逐步增加这个比例。随着时间的推移,你的储蓄会越来越多的。 我建议你将储蓄的资金分配到不同的账户中,例如退休投资账户、紧急备用金账户和普通储蓄账户。 在偿还债务和储蓄之间,我建议你根据收益率进行优先排序,优先偿还高利率债务。 记住,奖励自己也是很重要的,这可以激励你坚持储蓄。 最后,想象一下你未来的生活,这会让你更有动力去储蓄。

Deep Dive

Key Insights

Why is it difficult for humans to save money according to behavioral economists?

Humans are hardwired to focus on the present and immediate gratification, a trait rooted in evolution. Behavioral economists call this 'discounting the future,' where people prioritize current needs over future ones, making it challenging to save for long-term goals.

What is the most effective way to start saving money?

Automating savings is the most effective strategy. Setting up automatic deposits into retirement accounts (like a 401k or 403b) or savings accounts ensures consistent saving without relying on willpower. Research shows that 90% of people stick with automatic savings plans, even if they initially feel overwhelmed by debt or expenses.

How much of your salary should you aim to save, and how can you start if money is tight?

The goal is to save 10-15% of your salary. If money is tight, start with as little as 2-3% of your paycheck and gradually increase it over time. Even small amounts add up, and automating deposits helps ensure consistency.

Why is it important to take advantage of employer matching in retirement plans?

Employer matching is essentially free money. For example, if your employer matches contributions up to 7%, contributing enough to get the full match doubles your investment. This is a smart financial decision that significantly boosts your retirement savings.

How should you prioritize saving versus paying off debt?

Compare the returns on saving versus the cost of debt. Prioritize high-interest debt (like credit cards) first, as paying it off is equivalent to earning a high return. Next, focus on lower-interest debt (like student loans) while still contributing to retirement accounts, especially if there's employer matching.

What is the benefit of rewarding yourself while saving?

Rewarding yourself, such as planning a trip or buying something you enjoy, can motivate you to stick to your savings plan. This practice, known as mental accounting, helps assign purpose to your money and prevents random spending.

How does envisioning your future self help with saving?

Envisioning your future self, such as imagining a comfortable retirement, can increase your likelihood of saving. A Stanford study found that people who interacted with avatars of their older selves saved twice as much for retirement compared to those who didn't.

Why is starting to save early in life so impactful?

Starting to save early allows your money to grow significantly due to compound interest. For example, saving $30,000 by age 30 could grow to half a million dollars by retirement. Early savings benefit from decades of tax-free growth, making it a powerful financial strategy.

How can having your finances in order impact your relationships?

Being financially responsible can make you more attractive to potential partners. A poll revealed that people are more turned off by debt than by a nonviolent felony record. Having savings and a retirement plan signals responsibility and shared lifestyle goals, which are important in relationships.

Chapters
This chapter explores the evolutionary reasons behind our difficulty in saving money, highlighting our inherent bias towards immediate gratification. It introduces the concept of 'discounting the future' and sets the stage for practical strategies to overcome this ingrained behavior.
  • Humans are hardwired to focus on the present.
  • Saving requires fighting against millions of years of evolution.
  • Behavioral economists call it discounting the future.

Shownotes Transcript

Translations:
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Support for NPR and the following message come from our sponsor, Whole Foods Market. Find great everyday prices on responsibly farmed salmon, no antibiotics ever chicken breasts, organic strawberries, and more at Whole Foods Market. We are going to start in caveman times.

All right, you are a caveman. Just go with me here, or a cavewoman. Either way, you're pretty hairy, you know, attractive in your own way. But we are roaming around the savanna. You're fighting for your life every day. You're foraging for food. I mean, danger is everywhere. It's kind of exciting, but it's also kind of scary because there's wolves and saber-toothed tigers, and they're creeping up behind you all the time. It's like, whoa. Grrr.

Now, is this the best time to be thinking about saving and your 401k retirement account and stuff like that? I mean, no, of course not. Cavemen don't think about that stuff. You need to survive the day and eat food and don't get eaten yourself. And OK, we're being stupid and corny here. But this is, in fact, a good lesson about saving money, because the point is that we are hardwired to focus on the presence and immediate gratification of

And it's been that way for a very long time. And this is like the opposite of what your brain has to do to focus on saving money. Behavioral economists call it discounting the future. We basically say it's hard for us to wait. We don't want to wait. We want to get it right now at this moment. And we discount the importance of what we'll need in the future. So actually, to save money for the future, you have millions of years of evolution to fight against. But there's a way to win the fight.

Oh, sorry. That was me. This is your NPR Life Kit for saving and investing. And in this episode, we're going to be talking about how to start saving money. And it's going to be worth it because, you know, going on vacations is fun. And I want to retire with a nice cabin and a fishing boat and be super happy down the road. And to do that, you have to actually start saving money and sticking it away somewhere. We're going to learn how right after this.

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I'm Chris Arnold, and I've reported on personal finance for years. And there's just so much about money that we need to know and that we don't learn in school. And in this episode, we're going to give you some really good practical tips, things that have been researched and proven to work to help you save more money. And okay, call this big takeaway number one. If you want to save money, you have to make it automatic.

I'm making a dramatic pause here. Automatic. Get that in your head. Remember it. It's really important. This gets back to the caveman thing. Our brains are just not going to focus on a lot of the, oh,

Oh, you know, it's Tuesday. I guess this is the day I need to transfer some money to my savings account. Let's do that right now. I mean, no, that's just not going to happen. The most important thing you can do right now is automate your savings. I mean, right now, you should be putting on autopilot your 401k at your job or your 403b at your job or your bank savings account. That's Beth Kobliner. She's a financial expert. She wrote a book called Get a Financial Life.

And she spent her career helping people make sense of their money. It's true. And I know how it can seem so overwhelming. You're not alone. And for some people, look, if you're living paycheck to paycheck or supporting a relative or a single parent, saving can seem really impossible. And I mean, I started out freelancing in public radio. I drove a $600 car. I know that sometimes you can't save any money.

But when you get to the point where you can just save anything, something, that is better than saving nothing. And there are good strategies to make it a lot more doable. And if money is really tight, here's one thing you can do. You can just start with like 2% of your paycheck and start auto depositing that into a retirement or a savings account. People always feel like, oh, I can't save. It's too hard because our lifestyles adjust to our paycheck.

But as best as you can, put that 2%, 3% to start and then start increasing it every year. And then Beth says the goal should be to save between 10 and 15% of your salary, whether you can do that right away or sort of inch it up over time. You know, if you get a raise or inflation goes up and usually your paycheck comes up a bit, you know, every year or so you bump it up another 2%, another 3%. And four or five years out, you're saving a significant amount of money.

And then you want to get that auto-deposited into a savings account so it's not just sitting in your checking account. You don't want to be able to touch the money. You don't want it to be there. Because once you touch that money, you spend it. Automatically putting at least 10% to 15% of your salary into these accounts makes sense. To me, this is the biggest takeaway. This is the most important thing, that there's a behavioral economist named Bridget Madrian at Harvard and Fulbright.

She did this research that found that if you automatically enroll someone in a retirement plan, like the company does it, 90% of people, and these are the same people who will say, oh, I've got student loans, I can't save them. Oh my God, this is impossible for me. 90% of people will stick with it and they'll save and they'll do it. Absolutely, yeah. Okay, our next takeaway, call it tip number two. You want to split this money that you're saving up into several different accounts. All right, here's how this is going to work.

If we have that 15% that we're ideally saving, Beth says maybe 8% or 10% of that goes into just your retirement investment account, especially if your employer matches what you put in. Then you just have to put in enough to get the full match. I mean, that's free money.

You put in a dollar, you get a dollar. Who would say no to free money? If you walk into, you know, you see a few hundred dollars on the street, you pick it up. You know, this is free money that people are passing up. So it is so important, no matter what your age is, you must put the most your company will match up until, some companies say 7%, 10%. Put that into your retirement savings account. You're making a smart financial decision and you're really also providing for yourself down the road.

We've actually got another whole episode specifically on how to set up a retirement account and invest it in a really smart way. So check that out. And then Beth says the rest of the money that you're saving, she says you can set up on auto deposits every paycheck into an emergency fund or some people call it a buffer account and then take some and put it in just a savings account for fun stuff that you want to do or the things that you really want to spend money on. Tip number three, how do you prioritize saving versus paying off debts?

And a lot of people get confused by this and they just don't know what to do. And it gets in the way, which is understandable because, you know, you might think I have these student loans and I have these credit cards and I need to pay them off. How can I be saving? Beth says a good way to think about this is to compare the amount that you could be earning by saving and investing versus what is the debt costing you and then prioritize it that way.

I say it's just go by the numbers. So putting money into a retirement account is earning, if you have matching, like 100% on your money. Then what's the next interest rate? Paying off a credit card that's charging you 17% is the equivalent of earning 17% on your money. That's the next best. And that's where you should put your money. Paying off that high rate debt

and then paying off the lower rate debts like the student rate debt. And then finally, you want to have a little bit of money set aside for a plain old bank account, a bank savings account that maybe only pays 2%, which isn't great, but it's emergency money, money you know will be there. So when I said you save in total 15% of your paycheck, you divide it up among those priorities and you look at the numbers and you put it in order of what makes sense mathematically.

That's one way to do it. We've been doing some heavy lifting here with percentages and accounts and all this stuff. I've got some good news. The next big tip is, and call this tip number four, sometimes it makes sense to just blow some money on yourself, especially if that gets you to actually do these things that we're talking about. So that says, think of something that you like to do or something you want to buy that costs, say, $200 or $300. Maybe it's a weekend yoga retreat or a trip someplace with a beach.

And then this week, get all this done. Get the account set up, the auto deposit, all this different stuff. And then do it. Go ahead. Buy the trip. Give yourself the reward. Giving yourself a small award can be really motivating. This is actually known as mental accounting. We give our money a particular purpose.

And that helps us keep from spending it randomly. And so that's absolutely a great idea. And it's interesting. Studies have found that people who are good at delaying gratification, they're not necessarily self-deniers and they don't give themselves anything. They're actually just better at distracting themselves. So one good way to distract yourself, yeah, I'm putting 10% in the retirement plan. But then I have this trip I'm looking forward to and I'm going to save this $200 for the flight.

Now, I want you to close your eyes and imagine your future self 20 or 30 years from now, whatever it is, you've totally crushed it. You've saved a lot. You've invested smart. You don't like on a vineyard. Let's be a little realistic. But but where are you? Are you like in the desert? You got this Adobe house. You're painting like Georgia O'Keeffe.

For me, I'm on someplace like Cape Cod, maybe not quite that expensive. It is public radio, but I've got an awesome cabiny kind of house for me and my wife and my kids and friends come and stay because, you know, it's beautiful. I got a fishing boat. OK, so the simple act of doing this can actually make you better at saving money.

Research shows that envisioning your future self can actually make you more likely to save. Stanford did this very cool study, and they had two groups of students, and they gave each of them avatars. They made computer avatars for them, but one group of avatars were the same age as the students, and the other group of avatars were avatars in their 70s. And then after the students interacted with their avatars,

They asked them, what would you do with $1,000? And those who saw themselves at age 70, who sort of got to know their 70-year-old selves, they saved twice as much in their retirement accounts. They said they would put twice as much into their retirement accounts than those who didn't meet their future selves. This next thing we're going to talk about, tip number six, is a massive takeaway if you are young. And here it is. The money that you save early in life

If you invest it, it can grow to just be massively huge. So you really want to start saving young. Like if you manage to sock away, say, $30,000 by the time you're 30 or in your early 30s, that could realistically turn into half a million dollars when you're retired. The magic of tax-free compound growth.

tax-free compound growth. I mean, to me, that's actually kind of exciting, but this next thing is even more exciting because what we're going to talk about now is, is that if you do this, if you start saving, you start building up a retirement fund and doing all this stuff, right? There might be an extra bonus in all of this, which is some relationship magic. Okay. This is a final big reason to start saving. It might just make you more attractive.

Kind of. I mean, OK, Beth says this stuff is a really big deal for people who are dating and looking for someone that they want to have a relationship with. I have a crazy poll question for you. Would you be more turned off by someone with a lot of debt or someone with a nonviolent felony record? So guess what most people pick?

Yeah, nonviolent felony is way better. When we meet people and we find out they have a lot of debt, suddenly you think, hmm, are they irresponsible? Do our goals match? You know, I'm very careful with my money and, well, this guy is, you know, charging up credit cards. And those are very important conversations to have with mates, right?

But as you're looking for a mate, you might want to kind of get your finances in order to, you know, broaden your options. Yeah. And not just because if your finances are a disaster, it's going to be a turnoff. But if you meet somebody and it's like, hey, whoa, they got 200 grand in a retirement account and they got all this stuff figured out and whatever.

They save and go on great vacations. It's like, I mean, it sounds like boring dollars and cents, but it's really about lifestyle choices. Absolutely. Options. It's about your mind over money. You know, where do you want to be? And thinking about that rather than the here and now and the nuts and bolts that can kind of bring us all down. Think about what you want in the future.

You can do all of this stuff, right? And even if you just start saving a small amount of money and then that starts to add up, I mean, it's going to feel really good. And just so we can remember all this stuff we've been talking about, here are the takeaways, starting with number one. Well, first, you need to automate your savings. You want to reach that goal of saving 10% to 15% of your salary.

Tip number two is that you want to divide up what you're automatically saving into a few different accounts. So none of this is in your checking account where you're just going to spend it on lattes. And you definitely want to take advantage of an employer match. Okay, number three. You want to prioritize what savings comes before paying off debt. Number four. Reward yourself. You don't have to deny yourself. Tip number five. I like this is envisioning your future self. It's fun and it'll help you save more.

And tip number six, this one's important if you're young, saving money early can add up to a huge pile of money later, thanks to compound interest. And finally, make sure to get your money in order just so you can meet your future mate and not feel embarrassed. And so it's like if you figure out a way to manage this, it will make your life happier.

For more NPR Life Kit, check out our other episodes. Our next episode is about how to invest all that money you're saving. We talked to one of the greatest investors in the world. He's got like a cheat sheet about how to get set up for a great investment account. Honestly, this is like I tell people about this all the time. It's super cool. Check it out.

And there's also the Your Money and Your Life Facebook group that we've set up. We got tens of thousands of people in there sharing ideas and suggestions, talking about all kinds of personal finance topics. As always, when we wrap up here, we have a completely random tip. This time it is from Griffin Rowell from NPR's marketing and branding team. So if I'm taking an Uber or Lyft and I want to get to a general area, I don't have a specific address or drop off that I need to arrive at.

Oftentimes I'll pick a few different locations and try them out and see if I can get a cheaper fare. Sometimes the algorithm kind of glitches and will knock a few dollars off, despite the location not being too far off from the desired destination. Life Kit is produced by Sylvie Douglas, Alisa Escarce, and Chloe Weiner. Megan Cain is our fabulous managing producer. Our music is by Nick Dupre and Brian Gerhardt.

Our project manager is Mathilde Piard. Neil Carruth is our wonderful general manager of podcast. And the senior vice president of programming is Anya Grunman. I'm Chris Arnold, and thanks for listening.

Are we going into another recession? Does anybody know for sure? No, they don't. And if they say they do, they are lying. I'm Stacey Vanek-Smith, co-host of The Indicator from Planet Money. Every day, we give you an economics crash course in 10 minutes or less. That's The Indicator from Planet Money.

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