THE BROKEN WALLET

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If you have a lower income or too much debt, saving money can be hard. It’s not impossible, but it might take longer to grow a safety net.

Although these are common obstacles, they aren’t the only ones. So your inability to save could be due to reasons “not” on your radar.

Whether you’re saving a rainy day fund, an emergency fund, or a sinking funds account, here are other reasons why it’s so hard to save money.

1. You don’t have the right support

I want to start by saying, you’re ultimately responsible and accountable for your finances. You’re responsible for paying your bills on time and creating a savings plan. 

But this doesn’t mean that peer pressure isn’t real, because it is.

In fact, financial peer pressure prevents a lot of people from getting ahead. However, this type of pressure can be subtle, so you might not recognize it.

It can be friends planning a vacation and begging you to come, even though you’ve said you can’t afford it. Or if you limit shopping and eating out (to save money), financial peer pressure can be friends saying, “you deserve it”, or “you only live once.”

It takes different forms, and sometimes, it can wear us down.

So it’s important to recognize pressure when it happens and stand your ground. At the end of the day, you have to pay the consequences for these decisions.

You need people in your corner who support and respect your decision to save money. I’m not suggesting cutting people from your life, but I am suggesting being “choosy” with who you spend most of your time with.

According to a 2018 Credit Karma/Qualtrics survey, “39 percent of millennials admit to overspending — even going into debt — to keep up with their friends.“

And that’s just millennials…

The number of people is likely much higher because this pressure doesn’t stop when you hit a certain age. So put some distance between you and those who don’t support your spending decisions.

2. You’re procrastinating

If you have a low income or live paycheck to paycheck, saving money might feel pointless if you can’t save a lot.

But I’ve said this before – and I’m going to keep saying it – even if you can’t save a lot, something is better than nothing. And if you’re waiting until your income increases, or until you’re out of debt, or until something else happens to start saving money, you’re only hurting yourself. 

A savings account is the biggest protection you have against the unexpected, and it’s your biggest weapon against credit card debt.

So even if you’re only able to save $10 a week, that’s $520 more than you started the year with. And yes, I know it’s a small cushion – but it’s still a cushion. In the event of an emergency, you’ll be glad you had the money available.

I’ve never met a person who regretted having a savings account, even a small one. If anything, they regretted not building one sooner.

3. You don’t have any financial goals 

Saving money is also hard when you don’t have any specific goals. Some people need a reason to save money. Putting money aside because it’s the right thing to do isn’t always enough.

Plus, without a concrete plan in place you might only save $5 here and there. In which case, you don’t really get anywhere fast.

By setting a goal to save a specific amount every week—no matter what—you’re more likely to make progress. Also, saving money becomes easier when you keep your goals visible.

An emergency fund isn’t the only reason to save money. You can also save for home improvements, a down payment, vacations – it really doesn’t matter. Whatever the goal, though, write it down and keep it visible.

Personally, I love vision boards. A board creates intentions, keeps you focus, and it’s a simple way to stay motivated.

4. You’re not tracking your expenses 

Before you start any savings journey, you have to track your spending and create a budget. Some people skip this crucial step, but it’s important to assess what’s coming in and what’s going out. And as a result, you might find extra disposable cash in your budget. That’s bonus money that can go into your savings account.

Some people honestly believe they don’t have extra money to save. But often times the problem isn’t that they don’t have extra money, but rather they’re spending their extra money until there’s nothing left.

You might be in a position to save $300 a month, but think you can only save $50 – because you’re spending a lot of your cash on non-essentials. In other words, you’re probably overspending on recreation, entertainment, and shopping.

5. You’re not automating

With regard to saving money, saying and doing are two completely different things. 

Even with good intentions, some people aren’t disciplined enough to manually move money from a checking account to a savings account on a regular basis. And after a while, they get out of this routine. 

So my recommendation is to automate your savings. If you take yourself “out of the equation,” saving money can become more consistent, convenient, and easy. There are many ways to automate. 

You can schedule transfers one or two days after your paycheck clears your account. You can ask your employer to split your direct deposits and have a percent deposited into a savings account. Or you can use micro-savings platforms like Acorns and set up recurring transfers while opting into their round up program and investing your spare change. The goal is to make saving money easier.