I thought I was too poor to save, but my grandma taught me 3 tricks that helped her retire comfortably

I thought I was too poor to save, but my grandma taught me 3 tricks that helped her retire comfortably

November 18, 2020
  • My husband and I married young and had our first baby soon after, and since then it's felt like we never have enough money to save.
  • But after talking to my grandma, who's been comfortably retired for over 20 years, I learned three tips for saving — no matter your income.
  • She showed me how to budget in a way that makes sense for my family, including how to budget for unexpected expenses.
  • And she also taught me how to find cost savings on everyday items.
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My husband and I married young. I'm talking a busser and a waitress young. We were in school, then we were unexpectedly expecting a baby, starting our careers, and buying a house. In other words, our lives were full, our finances fraught, and our savings unimpressive.

This isn't to say we've saved nothing over the years; we managed to put a little cash in the bank to help with our first down payment, and one year I spent months tucking a portion of my tips into a sock to surprise my husband with a flat-screen TV, but in terms of what one might call "grown-up saving," we just didn't. We needed all our income for more immediate concerns, like utility bills, groceries, and car maintenance. We simply felt that we were too poor to save.

Our financial situation has evolved over the years, but our improved income came with student loans to match, and what started as one breastfed infant has become three kid-sized eating machines with endless dental woes. We still feel too poor to save, but at the age of 32, we're halfway to retirement, and the thought that we haven't even begun to prepare for it is enough to fill us both with a dread we can no longer repress. I shudder when I think about the emergency funds and college funds I've been told adults are supposed to build. 

My grandma's life-changing advice

Recently I sat down with my grandma and asked her how she managed to save over the years. After all, she's never been a woman of extraordinary wealth and somehow she's been comfortably retired for 22 years and is looking forward to many more.

Even as I asked her, I secretly felt that we were too poor and it was probably too late to follow any advice she might give me. But it turns out that asking grandma is never the wrong answer. Her advice was not only practical and effective, it was doable. Even for us. 

Make a budget

My grandma's first piece of advice is simple: budget. This is not a new idea. In fact, my husband and I have several loose catalogs of our financial situation spread across a variety of laptops and hard drives gathering dust in our storage room.

But my grandma doesn't just write a depressing list of her expenses, feel discouraged, and forget about it for two years until she's ready to make a new one. My grandma's budget is a tool that she is constantly updating and consulting and applying to her choices.

When my grandma showed me a copy of her budget, I realized the main difference between hers and mine is that hers is much less idealistic. The budgets I've made in the past have always reflected the kind of frugal person that I'd like to be with the kind of problem-free existence I wish I had. Then I run the optimistic numbers and consider the surplus mine to enjoy. Except, there never is a surplus. Because cars break down, water heaters break, and if one of my favorite authors releases a new book, I will always buy it.

My grandma's budget doesn't ignore this reality. I was somewhat bewildered when I saw that "Beauty and Clothes," "Recreation," "Emergencies," and "Miscellaneous" were all separate categories. I asked her about the vaguely titled "Miscellaneous" because, for me, that's where I would sneak in a MAC eyeshadow pallet or treat myself to a new sweater, but she assured me she allocated money for such things in the "Beauty and Clothes" category. 

"So, is 'Miscellaneous' for getting drinks with friends or something?"

 "No, that's 'Recreation.' 'Miscellaneous' is for the unexpected things that come up." 

"Oh! So, something like a water heater going out?" 

"Well, no, that's an emergency. My 'Miscellaneous' fund is for things like printer ink. Purchases that aren't cheap, but aren't typical either." 

And then I understood — my grandmother budgets for literally every expense, even her printer ink. 

Applying this kind of budget to my life isn't difficult, but it does require a great deal of discipline. But the benefit comes from feeling in control of my own expenses, rather than feeling like they control me. Another benefit is that rather than spending my money and hoping there's something left over to save, I can treat my savings like another monthly expense, right alongside my electric bill and the new Tana French novel. 

Establish financial goals

Another piece of practical advice my grandma gave me is something I already do in the non-financial areas of my life: She begins each year with financial goals.

I do this with my health, my career, and my personal development, because these are areas where I feel I have the power to set goals and achieve them. But I simply didn't think I had that kind of control over my finances. My expenses decided what I did with my money, not me. So, I asked my grandma for an example of one of her financial goals.

"Well, for instance, last year I knew I committed to paying to have the driveway serviced several times over the course of the year."

This surprised me. When I think of financial goals, I think of paying off credit cards and saving X amount of dollars in the bank, but my grandma's financial goals are less sweeping declarations than they are an intentional shift of priorities. My grandma's driveway is a half-mile long asphalt road and replacing it would cost tens of thousands of dollars, but she saved that money by committing to pay the smaller, but still unpleasant, cost of multiple repairs over the course of the year. 

Find creative ways to save on costs

My grandma's last piece of advice is perhaps the most important: She stays consistently mindful of her savings. She told me with a knowing laugh that she is never too proud to clip a coupon or buy store brand, but her mindfulness is not limited to pinching pennies. She thinks about her savings in other areas as well.

Her credit cards have each been selected for their cash-back potential, and she uses them to pay all of her major monthly bills. She reminds me this hack only works if you treat the credit card like it's debit and pay it off at the end of every month, but when you're getting 1.5% on your $800 monthly grocery bill, there's your extra money for savings. 

Applying my grandma's advice

If I'm being honest, I still don't feel comfortable putting a grand in my savings account every month, but my grandma's advice showed me that isn't always what saving looks like. Sometimes it means getting creative with your cash, getting ahead of a big expense, or being honest with yourself about your monthly expenditures. By instilling these habits I will alleviate the immediate anxieties that keep me from saving for the future and help me find the space in my budget for saving.

As I thought over my grandma's advice and began implementing it in my finances, I realized that all of it went back to how she prioritizes. This doesn't mean she doesn't get her hair set every week at the salon, because she always has, or that she skipped big vacations, because she never will. My grandma simply orders her life around her goals, and her future is as important to her at 84 as it has ever been.

Perhaps that's why I always felt I couldn't afford to save — because my future never felt as important as my present. But my grandma's advice showed me that I had it backward. The truth is, I can't afford not to save. 

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