If you feel like you fail at saving and are living from paycheck to paycheck, listen up!
First of all, as much as I hate to use the word “fail”, I know how easy it is to beat yourself up over not managing your money as well as other families seem to. Each situation is different, so please don’t compare yourself to others.
I’m also not going to preach about how important it is to save money. Most people know why they should save money, but it can be a huge challenge to actually do it when you’re already struggling to make ends meet.
Why do you fail at saving?
There are lots of reasons mums cite for why they fail at saving.
Many of us have switched from two incomes to one so we can devote more time to our kids. Some of us can’t seem to find a job that pays well enough. Some mums have physical impediments to working or need to care for sick family members. Maybe you got hit with a rent increase or you’re one of the many people who lost work due to coronavirus.
There may not be much you can do about your job or your salary, especially in the middle of a pandemic, but there are some ways you can turn things around. If you can’t control your income, the best approach is controlling your outgoings.
Some people’s savings struggles stem from a lack of self-control with impulse buys, an inability to budget, or a lack of discipline when it comes to following their budget. That might be hard to accept, but the good news is that these are all factors that you can change!
How to win at savings
Here are four solid tips for adopting a winning savings strategy.
1. Shift your mindset
Saving is not an afterthought. If your plan is to pay your bills and save whatever’s left at the end of the month, you’re setting yourself up to fail. If money is just sitting in your account all month, you’re bound to spend it. So, you want to treat savings like any other expense. When you’re paying your bills each month, be sure to also transfer money into your savings account as if it were another obligation.
2. Split your wage
When I budget for my family, I use a rainy day fund, short-term savings, and long-term savings.
In my rainy day fund, I try to put away enough to cover at least a few months of expenses in an account that’s not that easy to access. This will take time, but once you’ve built it up, you won’t have to keep adding to it. Then, I split my wage, which I explain in great detail here.
First come the regular bills and recurring expenses. Then, I have long-term savings for big-picture expenses I’m working toward and short-term savings for smaller, more achievable financial goals like getaways. Whatever is left is my spending power for fun things like entertainment and small impulse buys.
3. Don’t forget the short term.
I really can’t emphasise enough how important short-term savings are. This is where you’re going to find motivation. When you’re saving up for something like a family excursion, short holiday, a new smartphone or that gorgeous watch you’ve been eyeing, it helps prevent you from spending money on meaningless things that can really add up over time.
It’s hard to get excited about budgeting for grown-up things like mortgages and bills, so this is where you’ll find some joy in your savings!
4. Be kind to yourself
Smart financial habits won’t happen overnight. When you have a setback, like you impulsively buy something you didn’t really need or dip into your savings, don’t fret too much.
I think of it like a diet – if you’re cutting sugar and give in and eat a brownie, it’s easy to just give up altogether and polish off the rest of the tray. Don’t do that! Admit your mistake, forgive yourself for slipping up, and get back to pursuing your goal. Celebrate what you’re doing right, and don’t get too hung up on those times you’ve strayed.
It’s hard to change unproductive financial habits and resist temptations to spend. But once you start, that great feeling you get when you see your savings add up will inspire you to stick with it!
Love,
Nakita xxx
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