5 ways to make savings easier

Tuesday, October 7, 2008

Saving comes easy for some, but it’s an impossible task for others. When I ask some friends about their savings, they sometimes cringe or tell me “I don’t want to think about that!” as if I asked them about a life-threatening disease.

The act of saving doesn’t have to be difficult or painful. If done right, saving can be a wonderful thing you can look forward to each month. A few years ago, I didn’t really take saving seriously, but after implementing some techniques, it’s something I now look forward to with each paycheck.

So how can we make saving easier to do?

Automate it. If you are employed then put about 5 to 15 percent of your net salary depending in your situation right away to your savings. Make sure you prioritize savings first before anything else no matter how small of percentage it is.

Focus on the benefits. I’m currently saving up and looking forward to buy a brand new car within the next 3 years to replace my 11 year old Sentra. Buying a brand new car is more frugal than keeping your a decade old car because of maintenance cost. Of course, the way to motivate myself is to think about that car. This motivates me to put that extra money to my savings instead of going to Starbucks every weekend.However, other types of savings such as for an emergency fund or a retirement fund tend to be harder. Maybe because their purpose and benefits still seem a bit abstract. For these types of savings that you aren’t particularly fond of, focus on the feeling of security you’ll have when these savings are in order. From my experience, it feels great not to worry about losing my job or getting sick because I know my emergency fund is there to catch me when financial problems arise. Plus, I just feel so free not being pressured to work super hard. That feeling of freedom and security, I wouldn’t trade for the world.

Have a mantra. During tough financial times where I was forced to live paycheck to paycheck, I used to have a mantra that I would recite in my head every time I was tempted to spend on something frivolous. My mantra was “Every time I spend on a short term want, I give up a part of a long term dream.”

Get visual. It’s also more encouraging to save if you can actually see what’s going to happen when you accomplish your saving goals. For example, if you really want to save up for a trip to Paris, you can cut up pictures of France from a magazine and place them in an area you’ll look at regularly - whether it’s on your office desk or by your bed.

Note: The visualization doesn’t work for everybody, especially those who forget that action is needed to make things happen. Some get stuck in the visualization without doing anything about it. In those cases, it’s not visualization - it’s mere daydreaming.

Reward yourself. Break down your savings goals into milestones and have a reward for each milestone you reach. For example, reward ytourself something after you reach a certain point of your savings. Say after reaching halfway point, reward yourself a good night out or maybe treat yourself to soothing day in Spa. Rewards are important because you won’t feel too bogged down or tired, thinking that all you do with your money is save it. Without rewards, it’s easier to fall back on old spending habits when you get too tired of saving.


Mabelle said...

hey there! thanks for the visit at my Mabelle. ya sure, we will exchange. Hehehe! But if I'll do that, sentiments will be gone.

Nwys, take care. God bless.

zxt said...

Nice blog. Helpful tips!

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