A Ridiculous Savings Program ( Ridiculously Awesome)
Posted 21st February 2012 at 02:12 PM by David Sneen
What kind of savings program encourages you to, no requires you to, spend? What kind of savings program has $0 saved during the first month? In fact, every member will save $0 the first month.
That would be an absolutely ridiculous savings program, right? After saving nothing in the first month, any financial counselor will tell you habits have formed--and it is doomed!
The Earn More Spend More Group plan
The Earn More Spend More Group plan is really a savings program. The plan itself speaks of spending new money (raises; active members earn at least a $100/monthly raise) and banking old money (the non-raise portion of your income). Certainly members are allowed to do what they want with their income, but if members spend their raises on something they enjoy, they will be motivated to earn more money next month. The non-raise or old portion of the money is the portion that gets banked. Obviously "banked" can refer to putting the money into savings. It can also mean, using it to pay off debts, attack a major expenditure, or save the house from foreclosure. But,...if one actually banks their earnings, there is no savings program anywhere that can touch the Earn More Spend More Group savings program!
Note: The Earn More Spend More Group plan only works with a residual income source.
Example
The minimum raise an active Earn More Spend More Group member will earn is $100. That money is all new. The new member saves nothing, and spends his/her new money after receiving the first month's deposit. At the minimum raise level, an active EMSMG member will earn $200 his/her second month. Save $100--spend $100. The active Earn More Spend More Group member will earn at least $300 his/her third month. Save $200--spend $100. And so on.
In chart form:
Save Spend Total
Month one $0 $100 $100
Month two $100 $100 $200
Month three $200 $100 $300
Month four $300 $100 $400
Total $600 $400 $1000
As you can see, each month, more money is added into savings.
Naturally, this program assumes that the member continues to be active. Of course, it will be impossible to earn exactly a $100 raise, month after month, so we can assume a consistently active EMSMG member will average more than a $100 raise.
A savings plan that saves $0 the first month. What value can it possibly have? It could be the most effective savings program you ever saw!
That would be an absolutely ridiculous savings program, right? After saving nothing in the first month, any financial counselor will tell you habits have formed--and it is doomed!
The Earn More Spend More Group plan
The Earn More Spend More Group plan is really a savings program. The plan itself speaks of spending new money (raises; active members earn at least a $100/monthly raise) and banking old money (the non-raise portion of your income). Certainly members are allowed to do what they want with their income, but if members spend their raises on something they enjoy, they will be motivated to earn more money next month. The non-raise or old portion of the money is the portion that gets banked. Obviously "banked" can refer to putting the money into savings. It can also mean, using it to pay off debts, attack a major expenditure, or save the house from foreclosure. But,...if one actually banks their earnings, there is no savings program anywhere that can touch the Earn More Spend More Group savings program!
Note: The Earn More Spend More Group plan only works with a residual income source.
Example
The minimum raise an active Earn More Spend More Group member will earn is $100. That money is all new. The new member saves nothing, and spends his/her new money after receiving the first month's deposit. At the minimum raise level, an active EMSMG member will earn $200 his/her second month. Save $100--spend $100. The active Earn More Spend More Group member will earn at least $300 his/her third month. Save $200--spend $100. And so on.
In chart form:
Save Spend Total
Month one $0 $100 $100
Month two $100 $100 $200
Month three $200 $100 $300
Month four $300 $100 $400
Total $600 $400 $1000
As you can see, each month, more money is added into savings.
Naturally, this program assumes that the member continues to be active. Of course, it will be impossible to earn exactly a $100 raise, month after month, so we can assume a consistently active EMSMG member will average more than a $100 raise.
A savings plan that saves $0 the first month. What value can it possibly have? It could be the most effective savings program you ever saw!
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