There is a project “America Saves” which was launched by a non-profit organization in the USA and offers a lot of tools and solutions to help people to achieve their saving goals. Have you ever thought why some organizations like this, that do not have any benefit from a process, are encouraged to help you to save money and not to spend it? In fact, a habit of saving solves many issues, such as education debt or wedding credits if you start developing it early enough. Here we offer you to become aware of the barriers that hinder evolving of your saving habit and start overcoming them.
Barrier #1. A Competition between Different Goals and Desires
It happens so that we have more than just one desire (it would be easier to achieve it, but life would not be much fun then.) Our big dreams and plans might compete with the small and urgent ones (like going a round-world trip when you retire or buying the latest iPhone right now). Sometimes, we can have several desires big enough to save for a long term, but you just cannot decide for which you should save and do not save at all. It is hard sometimes to make decisions if you are afraid of choosing a wrong option.
Barrier #2 Short and Long-Term Desires
How to distinguish the short-term and long-term desires? Just measure your ability to satisfy them. If you can do it right now or within a few weeks, it is definitely a short-term one. If you need more time to accumulate money, the desire is considered as a long-term one. Have you ever noticed which desires you choose to satisfy more often? For instance, there is a choice to go for vacation to Bali next month or make a cheaper trip and save some money for investing into your retirement account (which will let you go to Bali when you are older, too). Usually, we want to get positive emotions right now, which is why we are choosing the Bali vacation option. There is a saying “Everybody wants to go to heaven but nobody wants to die,” which means that we can hardly sacrifice the present for the sake of the future. And that is the second barrier to saving.
Barrier #3. Our Goals Are Multiple
In most cases, young people want a lot. A new iPhone, a house with an ocean view, a sports car and going on a round-world trip are just a part of the list. All these seem to be the rather exact aims possible to achieve with the help of a good amount of money. However, if you start saving for everything at the same time, you have not many chances to finish it soon. Select what you want the most or the desire that is the most necessary to satisfy.
Barrier #4. Emotional Spending
Even if you have never come across this term, you have definitely done it and not for once. So, what does it mean? Imagine the time when you are going to the shop to buy milk but come back home with a new frying pan, a pair of jeans and a diary to write your thoughts on self-control. It is called the emotional spending. Very often, special offers from retailers or just beautiful showcases try to manipulate us suggesting something very cheap, very attractive or helpful. Unplanned shopping happens and does not let us save the money we were meaning to save. To resist it, try to write shopping lists, follow them and not check whether or not there is something interesting and extra cheap in every store with the notice about a sale.
Barrier #5. Being Tired of Making Decisions
When you are about to make a big purchase, for example, buying a new automobile, you have a lot of decisions to make. You need to choose its model, color, materials for a saloon and a number of technical characteristics. After the manager shows you more than four or five options, your brain switches off and you are likely to choose anything just to make it faster. Besides, if you are a student, a homework overload might have already struck you. But don’t worry, you can pay someone to do math homework, get some relief and, with as much common sense as possible, come back to the issue of a difficult choice. Not knowing exactly what is better for you, you tend to spend more than you expected because you lack the mental energy to think thoroughly about your choice. Also, you can select a default set of characteristics, although it is usually more expensive and not exactly what you need. This is how impulse purchases happen.
Now you can yourself work out which barrier sets you apart from developing a regular saving habit.