{"id":63,"date":"2012-01-20T06:01:24","date_gmt":"2012-01-20T06:01:24","guid":{"rendered":"http:\/\/www.cultofmoney.com\/?p=63"},"modified":"2021-10-27T13:54:13","modified_gmt":"2021-10-27T21:54:13","slug":"catch-the-wave-method-to-save-money-and-reduce-debt","status":"publish","type":"post","link":"https:\/\/www.cultofmoney.com\/catch-the-wave-method-to-save-money-and-reduce-debt\/","title":{"rendered":"Catch The WAVE Method To Save Money And Reduce Debt"},"content":{"rendered":"<p><a href=\"http:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/Wave-Method.png\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright size-medium wp-image-2225\" src=\"http:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/Wave-Method-200x300.png\" alt=\"Wave Method\" width=\"200\" height=\"300\" srcset=\"https:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/Wave-Method-200x300.png 200w, https:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/Wave-Method-683x1024.png 683w, https:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/Wave-Method.png 735w\" sizes=\"(max-width: 200px) 100vw, 200px\" \/><\/a>The WAVE method for saving money is a multifaceted plan in order to <a href=\"http:\/\/thecollegeinvestor.com\/16888\/the-simple-tricks-to-save-an-extra-500-per-year-in-college\/\" target=\"_blank\" rel=\"noopener\">trick your brain and allow you to save more money<\/a> over longer periods of time than you otherwise would.&nbsp; The reason it is called the WAVE method, is if you take a look at a graph of your expenses, savings, and cumulative savings, you can see a wave-like structure in each graph.&nbsp; The secret to saving money is to make your brain think it is pleasurable to save money and that doing without some things is just fine.<\/p>\n<p>The reason you need help is your lizard brain is fairly smart in knowing what it wants.&nbsp; It knows that less money for things it wants probably won\u2019t be that much fun.&nbsp; And your lizard brain is right.&nbsp; <a href=\"http:\/\/www.cultofmoney.com\/2015\/07\/29\/put-more-money-in-savings-with-these-five-strategies\/\">Saving money and depriving yourself of things usually isn\u2019t much fun<\/a>.&nbsp; In order to trick your brain, we\u2019re going to do three things.<\/p>\n<ul>\n<li>First, turn saving money into a challenge or game, with your savings as the score<\/li>\n<li>Second, work in waves of savings so that your brain isn\u2019t continually focused on what you don\u2019t have<\/li>\n<li>Third, reward your brain for doing a good job of saving.<\/li>\n<\/ul>\n<p>Of course I\u2019m making the assumption that you\u2019ve decided that you really do want to save more money or cut your debt aggressively.&nbsp; If you don\u2019t have some fairly basic goals, goals which you can simply articulate, you probably won\u2019t be able to maintain savings long-term, even with all the benefits of the WAVE saving method.<\/p>\n<h2>Details of the WAVE method<\/h2>\n<p><a href=\"http:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/WAVE-Saving-Method1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-67 aligncenter\" title=\"WAVE Saving Method\" src=\"http:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/WAVE-Saving-Method1.jpg\" alt=\"CultOfMoney income, expense, savings, cummulative savings graph\" width=\"500\" height=\"300\"><\/a><\/p>\n<p>One of the principles of the saving method is to turn saving into a game or challenge.&nbsp; Part of that is collecting metrics and details on your savings and\/or debt levels.&nbsp; In performance management cycles, that which gets measured gets better.&nbsp; Posting a chart updated weekly on the fridge so that you see it every day is a great way to remember that there is a good reason you\u2019re eating ramen.&nbsp; Additionally, <a href=\"http:\/\/www.cultofmoney.com\/2016\/01\/13\/how-to-motivate-yourself-to-stick-with-your-goals-this-year\/\">keeping track of your savings each week<\/a> will keep you focused on your savings goal.<\/p>\n<p>We recommend using <a href=\"https:\/\/www.cultofmoney.com\/go\/personalcapital\" target=\"_blank\" rel=\"noopener sponsored\">Personal Capital<\/a> to automatically keep track of everything online. It&#8217;s free!<\/p>\n<p>Another tenet of the saving method is to have periods where to keep motivation high, you really need to see results, so you hit it hard.&nbsp; Don\u2019t go out to eat at all, bring your lunches to work, cut everything that you can cut.&nbsp; And by cut I mean don\u2019t spend, not defer.&nbsp; However, this is not sustainable.&nbsp; That is the problem most people run into when attempting change.&nbsp; You can\u2019t live so low for an extended period unless you have especially high internal motivation.&nbsp; This is the primary reason for the name WAVE method.&nbsp;&nbsp;&nbsp; Look at the yellow line in the included graph.&nbsp; This is the net savings amount each week (simply the difference between income and expenses).&nbsp; Note that never are you spending more than you make, as negative savings.&nbsp; There are weeks that you may fall back to breakeven, but never exceed income, at least that is the goal.<\/p>\n<p>Finally, you need to have these up spending cycles to reward yourself and your lizard brain.&nbsp; If all you get for doing a good job and limiting spending is less and less, your lizard brain will make the connection that saving money leads to less pleasure.&nbsp; You want to reverse this, and reward yourself for saving money and <a href=\"http:\/\/www.cultofmoney.com\/2016\/06\/01\/6-steps-getting-debt\/\">paying down debt<\/a>.<\/p>\n<h2>What must you keep and what can you cut?<\/h2>\n<p>First, determine what part of your expenses are really and truly necessary.&nbsp; These are your fixed expenses.&nbsp; Things like rent, some amount for food, and insurance.&nbsp; Then everything else is variable costs, and subject to be cut.&nbsp; Things like your daily coffee, eating lunch out, eating dinner out, clothes, anything.&nbsp; Your goal is to live very low during the down weeks.<\/p>\n<p>The data for the above graph is shown here:<\/p>\n<p><a href=\"http:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/WAVE-Saving-Method-Data.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-68 aligncenter\" title=\"WAVE Saving Method Data\" src=\"http:\/\/www.cultofmoney.com\/wp-content\/uploads\/2012\/01\/WAVE-Saving-Method-Data.jpg\" alt=\"CultOfMoney WAVE Saving Money Method\" width=\"650\" height=\"136\"><\/a><\/p>\n<p>This just shows 3 months, but even someone making only $2,400 a month can still put away $1,800 in just a few months.&nbsp; Average spending each month is fairly stable, but it\u2019s the WAVE within the month that makes the lizard part of your brain happy.<\/p>\n<p><em>In conclusion<\/em>, you need to have set the goal to save money or get out of debt, you have to turn it in to a challenge or game and track it diligently, you need to see results for motivation, but live realistically enough to be sustainable in the long term, and you need to reward yourself and your brain for job well done.<\/p>\n<p style=\"text-align: center;\"><em><strong>So what are your secrets to saving money, staying motivated while doing so, while still being able to live life?<\/strong><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The WAVE method for saving money is a plan to save more money over time. Look at a graph of your expenses, and savings, you can see a wave-like structure.<\/p>\n","protected":false},"author":1,"featured_media":77,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[13],"tags":[33,32],"acf":[],"_links":{"self":[{"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/posts\/63"}],"collection":[{"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/comments?post=63"}],"version-history":[{"count":0,"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/posts\/63\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/media\/77"}],"wp:attachment":[{"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/media?parent=63"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/categories?post=63"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.cultofmoney.com\/wp-json\/wp\/v2\/tags?post=63"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}