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4 Reasons You Are Bad at Saving

4 Reasons You Are Bad at Saving

To address the concern of your bad saving habits, you need to figure out first if you’re really bad at saving, or if other issues come into play. If you answer yes to the following questions, then there’s a high possibility that you are:

  • Have you ever experienced the feeling of guilt when you spend money for something that isn’t considered a necessity?
  • Does the statement of account of your savings or checking account include frequent withdrawals and debits?
  • Do you think that your wallet is a perpetual black hole that magically absorbs your money and leaves you with nothing behind?

If you nodded your head and said yes to all of these, then you might be bad at saving.

As the saying goes, though: “You’re not alone!” Plenty of people are admittedly lax with their finances. Most aren’t that concerned about money management yet. No one wants to hear about investments or the stock market. Everyone wants to work hard and party hard, not knowing that saving hard and investing hard are actually the keys to attaining financial freedom.

As a result, you end up broke, weak-bodied and bitter when you get older. You simply couldn’t set aside money to be invested for your retirement fund because you weren’t able to adopt the habit of saving regularly when you were younger.

Why, exactly, are you mishandling your hard-earned money? Here are four reasons to help shed light on this issue:

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1. You’re the victim of lifestyle inflation.

As you grow older, gain more experiences, and get more chances to work at your job-related skills, you’re also more likely to earn more income. But, instead of saving more because of the increased inflow of cash, you tend to spend more. Thus, you think of yourself as being bad at saving.

Real Talk:

Most of us think that an increase in cash automatically means an increase in expenses. While this may be true in some cases where we get more responsibilities, all that extra doesn’t need to be spent recklessly.

If you got a sudden tax refund, a bonus, or a raise, don’t spend everything. Instead, save at least 20% and then allow yourself to spend the rest as you’d like.

2. You’re attracted to that sense that money = power.

Soap operas, fantasy movies, and even real-life celebrities and politicians perpetuate the notion that having money means having the power to control the situations and the people around you.

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You know this isn’t necessarily true. But, whenever people admire your branded clothes and whenever people treat you nicely as you flaunt your luxury bag, you can’t help but believe the idea that money is power.

Real Talk:

Money does seem to demand respect from others. But think of it this way: would you want to be admired because of your money, or would you rather be respected because of who you are as a person?

3. You procrastinate.

Why should you save up an emergency fund? You haven’t experienced an emergency yet.

Why should you invest for your retirement? You’re not going to retire yet.

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Why should you get life insurance? You’re still alive.

Real Talk:

You’re bad at saving money because you love to wait and wait and wait. Just because something hasn’t happened, doesn’t mean that it won’t happen tomorrow. You can either start now while everything’s still manageable, or you can start tomorrow when everything’s already a mess: it’s your call.

4. You think of saving as a chore; you don’t consider it a priority.

Saving is usually associated with being cheap or miserable, so most people don’t appreciate its importance. Instead, they choose to “live in the now” and prioritize automatic gratification.

Real Talk:

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Every life goal has a price tag associated with it. Do you have dreams that you’d like to achieve in the future? Home ownership, college, buying a car, going on vacation–all of these have a corresponding financial value!

Yes, it makes sense to spend for now. But it also makes greater sense to spend in the future.

Now, how can you find money to spend in the future?

You save and subsequently invest for it.

Yes, you can move from being bad at saving money, to being awesome at saving money. All it takes is a small start, and a lot of commitment.

Featured photo credit: cohdra100_1640.JPG/cohdra via cdn.morguefile.com

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Last Updated on January 21, 2020

How to Develop a Millionaire Mindset in 6 Simple Steps

How to Develop a Millionaire Mindset in 6 Simple Steps

We all like to dream about being financially wealthy. For most people though, it remains a dream and nothing more. Why is that?

It’s because most people don’t set their mind to achieving that goal. They might not be happy in their current situation but they’re comfortable – and comfort is one of the biggest enemies of growth.

How do you go about developing that millionaire mindset? By following these simple steps:

1. Focus On What You Want – And Take It!

So many people are too timid to admit they want something and go for it. When there is something that you want to accomplish don’t think “I could never actually do that”, think “I could do that and I WILL do that”.

Millionaires play to win, not to avoid defeat.

This doesn’t mean to have to become a selfish jerk. What it means is becoming more assertive and honest with yourself. You don’t have to grab off other people. There is a big pot of unclaimed gold in the middle of the table — why shouldn’t you be the one to claim it? You deserve it!

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2. Become Goal-Orientated

It’s almost impossible to achieve anything if you don’t set firm goals. Only lottery winners become millionaires overnight. By setting yourself attainable goals, you will get there eventually. Don’t try to get rich quickly — get rich slowly.

Let’s take the idea of making your first million dollars and expand on what kind of goals you might set to get there. Let’s also say you’re starting at a break-even position – you’re making enough to get by with a few luxuries, but nothing more.

Your goal for the first year can be having $10,000 in the bank within a year. It won’t be easy but it is doable. Next, you need to figure out the steps you need to take to achieve that goal.

Always look at ways to make growth before cutbacks. With that in mind, you might want to see if you can negotiate a pay rise with your boss, or if there’s another job out there that will pay better. You might be comfortable in your old job but remember, comfort stunts growth.

You may also have other skills outside of your workplace that you can monetize to boost your bank balance. Maybe you can design websites for people, at a fee of course, or make alterations to clothes.

If this is still not enough to make the money you need to save $10,000 in a year, then it’s time to look at cutbacks. Do you have a bunch of old junk that someone else might love? Sell it! Do you really need to spend $10 on your lunch everyday when you could make your own for a fraction of the cost?

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If you are to become a millionaire, you need to start accumulating money.

Here’re some tips to help you: How to Become Goal Oriented and Achieve More in Life

3. Don’t Spend Your Money – Invest It

The reason you need to accumulate money is for step three. Millionaires tend to be frugal people, and that’s because they know the true value of money is in investing. Being your own boss goes hand-in-hand with becoming a millionaire. You’ll want to quit your regular job at some point.

Stop working for your money and make your money work for you.

Rather than buying yourself a new iPad, that $500 could be used to invest in the stock market. Find the right shares (more on that later), and that money could easily double within a year.

There’s not just the stock market — there’s also property, and your own education.

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4. Never Stop Learning

The best thing you can invest in is yourself.

Once most people leave the education system, they think their learning days are over. Well theirs might be, but yours shouldn’t be. Successful people continually learn and adapt.

Billionaire Warren Buffet estimates that he read at least 100 books on investing before he turned twenty. Most people never read another book after they’ve left school. Who would you rather be?

Learn everything you can about how economics works, how the stocks markets work, how they trend.

Learn new skills. If you have an interest in it, learn everything you can about it. You’d be surprised at how often, seemingly useless skills, can become extremely useful in the right situation.

Start developing the habit of learning continuously: How to Create a Habit of Continuous Learning for a Better You

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5. Think Big

While I advise to start off with small goals, you absolutely should have a big goal in mind. If you have a business idea, then that is your ultimate goal – to start that business and make a success of it. If you want to invest your way to millions of dollars and do little work other than research, then that is your big goal.

There is no shame in not achieving a big goal. If you run a business and aim to make $1 million profit in a year and “only” make $200,000, then you’re still significantly ahead of most people.

Aim for the stars, if you fail you’ll still be over the moon.

6. Enjoy the Attention

To be successful, you have to be willing to promote yourself and enjoy the attention to a certain extent. Now the attention doesn’t need to be on yourself, it could be on your brand, but attention definitely attracts money.

Never be embarrassed to get your name out there. That means finding a spotlight and being brave enough to step right up underneath it.

If you run a business, try contacting the local papers. You’d be surprised at how amenable they often are to running a story about you and your business, and it’s all free publicity.

Above all, remember: You control your own destiny. Push hard enough for anything and you’ll get it.

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Featured photo credit: Austin Distel via unsplash.com

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