How I Save for Big Purchases Without Going Into Debt

When I was in my twenties, I was infamous for spontaneous purchases. If the idea entered my head to buy something, I would have to get it right away. Maybe it’s age or learning from the numerous personal finance books that I have read, but I no longer do that. I wait 24-48 hours before making a big purchase. If I still feel I need it after that time period, then I will get it. There have been a few slipups because I am not perfect. I still need to work on not eating out so much (Side note: I have no willpower when it comes to food. I love it so much), but I am improving.

When I decide to make a purchase, I try to make sure I do not pay credit for it. If I use a credit card, I usually will do it for the points, and I will pay it off before the next month. Instead, I use the following method to make sure that I can afford a big purchase that I decided to buy, and I do run up my credit cards.

SmartyPig

I have tried several savings apps, and the best one that I have found is SmartyPig.com, which I have been using since 2016. They were bought by SallieMae a couple of years ago, and I appreciate that they haven’t only changed for the better since then. SmartyPig is great because when you create a goal, you also select:

Start Date when you want to start contributing to the goal
Target Date
Target Amount
Time frequency you want to contribute to the goal
Automatically calculates how much you need to save to achieve your goal. This can be manually changed
Goal beneficiaries – I usually add both my kids, but if it’s a goal that is being set for one of them, I can select one.

If you need to temporarily stop contributing to a goal, you can pause a goal. At any time, you can restart it back up again.

When you decide to close the goal, you can either send it to your banking account or move it over to another goal. I usually move it to my checkings account, but there have been a few times that I have transferred it to another goal.

If this is a goal that you are doing with more than one person, you can create a group goal. I used it once, and it was easy for both parties. One of my friends uses it for big trips with a group of friends, and she says it has made collecting money from everyone so much easier.

The only issue that I have with SmartyPig is how long the most recent contribution takes to be released. Therefore, make sure you take that into account when you are thinking of your Target Date.

Since I have started using SmartyPig, I have used it for numerous vacations that I have taken, improving my home, and things for the kids.

I am currently saving for a big family cruise we are taking this summer, and I am excited to know that I can take it without going into major debt.