Savings will grow
The next thing to consider is what you plan on spending in the future and start saving for your future. Since we want to eliminate debt, we want to make sure that there is cash ready in savings for the things that you will want to do, see, and have.
If you have completed the Focus On Income from Day 5 and Calculate Your Monthly Expenses from Day 6, you should have dollar amounts at the top of the worksheet for Monthly Income and Spending Plan Total. The amount currently in your Spending Plan Total should be only your monthly bills or expenses. Take the monthly Spending Plan Total and multiply it by 6, this is the amount you want to ultimately save in an account for your emergency fund of six months worth of expenses.
We recommend setting up individual savings accounts for each category of savings such as an emergency fund, health care fund, house fund, car replacement fund, school fund, travel fund, tax fund, investment fund, and retirement fund for any of the categories that are not being funded sufficiently elsewhere.
The very first savings account it is important to fund is an emergency account that contains at least six months of your expenses. As for the other accounts start to consider the future and what you will need your savings to be to support it.
Save the Spending Plan Worksheet and have it ready for tomorrow!