How Red Box Rentals become $38K in  Retirement Cash

For years as a kid growing up my Dad said, "Take care of the pennies and the dollars will take care of themselves."  It is absolutely true.

We never believe that driving an extra half mile to save $.04 on a gallon of gas would amount to much. Nor do we consider that hanging a load of clothes on the line outside versus using the clothes dryer would save $2.33 per load. So too, a Red Box video rental generates the same denial of monetary value as the others, "nickle and dime-ing" our savings out of existence.

I have a family member that loves the Red Box. In fact he loves it so much that he's there nearly every day. Generally he buys a video rental 5 out of 7 days each week. "It's only a buck," he says.  To me that's a $5.40 weekly annuity.  By calculating the value of that annuity over five years one would be surprised at the outcome; It's no small change. It represents $1,467.43 over that period. Cha-Ching! Now add to that the $104.00 in annual gas savings of 4 cents per gallon mentioned and $121.16 saved in using the clothes line each year and the pennies start becoming real dollars. After one full year you would have $505.96 extra cash. Deposit that same amount each year into a Certificate of Deposit at 3.05% with Astoria Federal Savings and leave it there for fifteen (15) years and the future value would be $38,312.22.  

According to the 2008 U.S. Census report there are 18.3 million Baby Boomers  between the ages of 55 an 59 years old. In theory these Boomers could work for another 15 years. Imagine if each Baby Boomer in this demographic followed the dicipline of depositing $505.96 each year into an annuity over 15 years it would generate a little over $701 Trillion in savings nationwide by 2025. Let's really think big and imagine if the other millions of workers did the same we would say good-bye to our debt with China.  More importantly, America could recover from their economic "Boo-Boos" and snap back to a viable economy.  So what do you say? Can you spare some change!   Bling!