Benefits Of Spending Less

I found an interesting calculator the other day, that I thought I would share with you. What makes this calculator so special is it shows you the Benefits of Spending Less
. For example, if I were to input no savings other than eliminating $50/month from cable, then I would have saved $6,641 in 10-years. After an assumed 25% federal tax rate and 0% state tax rate (since I live in Texas) the net result would be $6,472. Now if I were to live in a state that has a state income tax, we could enter an estimated 10% in that category and the savings would be reduced to $6,407.

Think of that, just by eliminating the cable bill, you could have enough saved for that dream vacation to Hawaii. How awesome would that be?

Let's take it a little further. Lets subtract 6407 from 6472. A net result of $65. This is the savings that I save by living in Texas instead of a state that taxes. Divide that $65 by the 10 years and then again by 12 months. We get a result f 54 cents. Now, what I am going to do, is get everything back to zero, except one category that will have this 54 cents in it. Reset the state tax to zero and I am going to see what the calculator figures is my savings, if that was the only place I were to cut. The result is that the calculator, won't let me figure anything less then $1, so for this estimate we will figure saving $1 a month. Assuming the same 2% rate of return and 25% federal tax rate, with no state taxes, the savings would be $133 (before taxes) in 10 years and $129 after taxes.

How neat is that? Sure $129 in 10 years isn't much, but that's 129 more then I would of had if I remained in Kansas and gave it to the state. Which means $129 more that can go into my retirement fund or future vehicle fund, where it can grow even bigger.

Listen, it has been suggested many times on this blog, by a number of readers especially. Eliminating the cable bill is something well worth considering, as is reducing your spending in any number of ways. Face it, once you spend that money, you can't get it back.

Benefits of Spending Less Calculator

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