Foundation Concepts:

1. Best practice demands that we focus on our “needs” not our “wants” when it comes to spending our money.  Too much of what we earn is spent to give ourselves small short term rewards like eating out, high priced coffee, manicures, video games, and our spending on these items makes it tough to save for the things that really matter to us, and that can help us achieve financial security in the long run (an emergency savings account, an education, a home, a retirement account.)
   
   
2. Many people feel a sense of hopelessness about saving.  They believe that they cannot save enough to make a difference.  It is important to demonstrate that small amounts of money, saved regularly over long periods of time can really add up.  It is the consistency of the savings habit, coupled with the power of compound interest, that can really make a difference. 
   
   
3. In order to develop a realistic savings plan, you will need to examine your income and your expenses and make some choices about how you spend your money.  This is a “spending plan” (or budget) – it isn’t that you are being told not to spend – of course you will spend money – it is that you are being asked to make conscious choices about spending your money in a way that gets you what you want in the long run, while covering your immediate needs such as housing, food, medical, child care and transportation.
   
   
4. Savings can be a hard habit to cultivate and many people find it is easier to save the money they never see.  That is why using tools like direct deposit, where a portion of your income is automatically deposited into your savings account for you, can really help to you get started.  Other tricks like change jars, or always rounding your checking account entries up to the next higher dollar can also work.  You should also use the majority of any windfalls that you get to finance your savings:  tax refunds, raises or bonuses.  Comparison shopping, the use of coupons, choosing generic brands, and delaying gratification can also help you boost the amount of money that you are able to save on a regular basis. 

Discussion Questions:

At the beginning of the video, Jane and Kim have very different approaches to using their money to make them happy. What are some of the advantages and disadvantages of both?

Do you think that Jane will ever reach her goals? Do you think the changes that she has made in her lifestyle will be worth it? 

What might make it more difficult for Jane to reach her goals? Will it be harder if all of her friends discourage her? 

What should Jane do if one of her friends, who knows how hard she has been working to save for her goals, asks her for a loan?  Would your answer change if you knew that the friend would probably never be able to pay Jane back?

What are some of your dreams?  Do you think that you can achieve them? What steps have you already taken? What steps could you take that you have not taken? Why not?

What are some things that you could do without in order to find money to save?