We are in the middle of America Saves week (February 24-March 2, 2008).

Although some people may feel that it is too late, it is never too late to start saving money. The purpose of America Saves week is to get more people thinking and involved in saving money. Yeah, we consume a lot but saving money is also a good thing to do as well. For me, saving money to spend it later and not having to worry about debt. It is great to enjoy a vacation or a night out because I have budgeted for it.

America Saves states on its website…

America Saves Week is a new effort aimed at reaching institutions and individuals to increase awareness that people need to save money, reduce debt and build wealth.

When the conversations on national news programs focus on money, the pundits discuss the first two most and neglect the wealth building aspect. Slow and steady is what makes real difference.

Yesterday I had some errands to run and in the process I found 3 pennies. It doesn’t seem like a lot but all I had to do to get those three pennies was pick them up. If I added those three pennies to my next month’s mutual fund contribution or add them to the principal on my mortgage, then I know I will earn more for them than I would if I just kept them in my purse.

If I gathered a few friends for the copper stars I found yesterday and even put them into a bank account I would earn a little over the course of a year. Saving really makes a difference with compounding interest. High interest is a saver’s (investor’s dream). High interest is bad for a borrower.

Building wealth on 3 pennies is not going to give me enough to live on but even saving/investing a few cents or a small amount weekly or monthly say $20 a week or $100 a month can make a difference. If you reduce your debt while increasing what you have saved then you are building wealth. Even though you may save, which is admirable, but having a large amount of debt reduces your net worth. America Saves offers reasonable tips for people, especially a section on saving on a tight budget.

High interest is an investors best friend and a debtors nightmare. If you don’t believe this, would you rather have a steady return of 15% annually or have to pay off a credit card with a 15% interest rate? Saving $10 or $20 a month would yield you more than paying “the minimum” with the same rate of interest.

It is never too late to start saving, sometime this week, check out America Saves and try to put away something extra, if you can.

Prepare for the inevitable. You never when or if you will need extra money or something. This weekend I went on a bus trip to Iowa and was snowed in at a bingo casino. This wasn’t a problem because our group wasn’t leaving until the next day. We did have a planned excursion but weren’t able to go because of the storm. There was a group of people who were supposed to leave on Sunday during the height of the storm. The people had only brought enough money for their expected expenses. They did not have any extra money to buy food or get a room and were upset.

The highway was closed because this was rural Iowa and even staff had a difficult time getting to work.

Thinking of a vacation? Maybe not right now but even if you are going on a vacation, always make sure that you have some emergency money when you go on a trip. You may not need to use it but it would be wise to have some money in reserve or a credit card to pay for another meal or extra night in a hotel. The cause of the delay was weather related. Even when we left traveling was slow going until we got to the interstate.

Taking a trip is great and wonderful. Sometimes unforseen problems arise. If you are a worrier, you would definitely need to make sure you have extra money. If you aren’t you still need to make sure that you have extra money so that you won’t worry about anything. Don’t travel so close to the vest with your money, you may not need to use th extra money but even if you aren’t delayed, you may be interested in purchasing a souvenir or travel memento. Even if you don’t use the money or need to, it’s nice to go home with some money you didn’t spend after you’ve had a vacation.

The same old frugal rule applies… don’t spend all of your money and have some in reserve if you need to use it.

If you are transferring money from a savings account to another, try to do it after the average daily balance is calculated so you will earn more interest.

Let’s say you want to transfer money from one account to another to use at the end of the month but your interest is calculated on the 7^th using your average daily balance for the last month. If you can wait you may earn a little more in interest than you would if you took the money out right away. This will definitely make a difference when you are transferring larger sums of money or even small amounts because ever little bit helps.

Savings accounts aren’t for long term investments but even in the short term if you are saving money to pay insurance premiums, income or property taxes and save to pay them throughout the year then you want to have your money in cash. Even if you are saving for a vacation, if you have at least $1000 saved that you don’t need for at least 3 months you may want to check out a CD.

Saving money is something that everyone should do but sometimes can’t because of unforseen expenses Just because you can’t afford a certain item or go to certain places doesn’t mean that you should forgo savings in order to afford a certain lifestyle.

Starting out with five dollars a week can help you build up your little nest egg, even if it means that you give up something that is only temporary. Saving and frugality go hand in hand. This does not mean that you are miserly if you decide that you can’t afford something because you are saving… you are being fiscally responsible.

What kind of financial changes would you like to make in the new year? This is the time when people make resolutions to lose weight, be healthier, organize or whatever…

Even if you are not making a resolution to make changes in the new year that would dramatically change your financial situation like get a much higher paying job or retire you still may want to make some financial changes in the coming year.

Change can be a good thing or a bad thing.

Some financial changes that could help you in the coming year are:

• Save for a large purchase

• Start a savings account for vacation

• Start a savings account for Christmas

• Seek out avenues to purchase less expensive materials for your hobby ( i.e. shop in thrift stores for fat quarters for quilting, yarn, or books)

• Use public transportation when you can. If you have to go somewhere to park and parking costs $12 or more and the train or bus would be less then take the train. If there are several people traveling together, taking a cab would be cost effective

• Treat yourself once in a while… within reason

• Buy quality, even if it means that you have to save up for it.

Shoppers can expect more deals for Christmas shopping this year. That’s good news right? That is because people who have been overspending for years or are feeling the crunch may be feeling the crunch all over. Holiday shopping is not the only concern for retailers. One area that concerns retailers is the lower end luxury items.

If the slowdown continues, luxury retailers could be hard hit. To appeal to a broader demographic, companies from Tiffany to Valentino have courted mass affluent shoppers with new lines at lower prices. The mass affluent account for 23 percent of households, compared to less than 2 percent for those with incomes upwards of $250,000, according to the U.S. Census Bureau.

These households, with incomes of $75,000 to $150,000, make up 23 percent of the population, and it’s “the marginally wealthy who are feeling a bit less well off,” said Milton Pedraza, chief executive of the Luxury Institute, a research group that studies behavioral habits of the rich.

Rather than just buying a purse or bag for $400 people may start thinking about whether or not they really need the item. The chief executive of the Luxury Institute may not really realize it but a single household with an income of $75,000 has much more disposable income than a 5 person household making the same amount.

Luxury items are just that special items that are not for everyone to have. Some high end items have increased in price over the years, not necessarily improving the quality but still having a name brand that is very enticing to some shoppers.

As people who are in the lower realms of “affluence” have to use more of their money to pay for staples such as food, energy and taxes then that leaves less money for frivolous items.

I have no qualms about buying a treat or two but not at the expense of vital necessities. I have seen high end purses that could use a little polishing cream for a fraction of the original price. I have also seen less popular colors of the current it bag on sale later on.

My advice would be to buy quality but less. Even the super rich will go broke if they don’t practice good spending habits. Don’t get sucked in by material things that you may not be satisfied with in a month or so. If there is something that you are really interested in that is pricey, go to a consignment shop which will have a higher price but better quality than a traditional thrift shop. Check thrift stores, you may get lucky. You can rent luxury items or rent to buy. Look in magazines for ways to get the fashion look for less.

If you really want the item, think about it first for a day or so* and then if you still want the item and it will not put you into too much financial strain – buy it. [*Unless you are on vacation and will not easily come back to this store... in that case buy it as your one really nice souvenir to yourself.]

Luxury shopping or any shopping for that matter should not be guided by impulse – use your head and relationship with money to guide you.