Does saving a little "here and there" really make a difference?

Remember the saying, "A penny saved is a penny earned?" Unfortunately, many tend to ignore the message behind this old adage because they fail to look at the long term effect of saving. Savings can be more valuable than earnings. Consider this: if you cut your expenses by just $1, you save a full dollar. On the other hand, if you pay 30% in taxes, to make enough to spend a dollar you would have to earn $1.43. In higher tax brackets you must earn even more.

This is just a simple example of how small savings add up to big dollars. On a larger scale, think about your weekly grocery expense. If you pay 30% in taxes, spend 20 minutes a week clipping grocery coupons for items you would buy anyway, and save $20 as a result, that is the equivalent of a raise of nearly $30 a week.

So clip coupons, save that loose change, and watch your savings grow!

Written by:
Sandra McKinnon, Consumer & Family Economics Specialist, University of Missouri-Columbia, University Outreach and Extension

Cynthia E. Crawford, Ph.D., Consumer & Family Economics Specialist, University of Missouri-Columbia, University Outreach & Extension

Last update: Tuesday, July 05, 2005