Let’s be honest, saving money is difficult simply for the fact that most people enjoy purchasing things. The emotional impact of buying something new is not small by any means, and is one of the main reasons that most people go into debt. Psychologically speaking, we humans really aren’t “made to save”.
That being said, below are 5 Tips that should help you to make saving your money easier. They might not be as enjoyable as purchasing something new, but they will help to put things in perspective and, more importantly, help you to put money aside for things like emergencies, college costs, and retirement, among other things.
Tip 1. Try to keep things in perspective. This is probably the most important tip. Any and all investments and/or savings accounts that you have are actually just a means to an end. They are there to provide security for you and your family in case of a financial emergency, or for when you retire. If you think that you’ll never have an emergency, or plan to work until the “day you die”, you’re being quite unrealistic and taking a big chance with your future.
Tip 2. Borrowing money for anything else besides a new home or a college education really doesn’t make sense. Having the biggest flatscreen TV, the newest car or the most technologically advanced tablet computer might seem like a great idea and might even make you happy for a short amount of time but, if you’re up to your ears in debt because of those purchases, you won’t stay happy for long.
Tip 3. Auto-withdrawals from your checking or savings account are the best way to save and/or put money in your retirement account. Simply put, the average person doesn’t have the willpower to take money from their weekly check and put it aside. If that money is automatically deducted from your check, and you never actually see it, the chance of saving and building up your retirement and savings accounts is going to be much better.
Tip 4. A little bit of financial education goes a long way. Frankly, with the Internet making information quickly and easily available, not taking some time to educate yourself about investing, finances and so forth is just silly. There was a point that I didn’t know what a binary option was, or an exchange traded fund, but then I educated myself on them. These types of investments are important to building up your nest egg.
Tip 5. It’s okay to reward yourself occasionally. Some people go from one extreme, spending everything they make, to the other and never purchase anything fun or frivolous. If you set goals for yourself and reach them, it’s okay to occasionally treat yourself and purchase something that you want but might not actually need. Psychologically speaking, this kind of accomplishment/purchase relationship is good for you.
Saving money isn’t always easy but, hopefully, these 5 Tips have given you some food for thought that will make it easier for you in the future.