We are several weeks into the New Year and chances are that you made some resolutions. There is also a good chance that you’ve already broken a resolution. Don’t worry though! Just because a resolution is broken doesn’t mean you can’t get back on track! This is certainly true for financial resolutions.
According to a Nielsen study, 25% of people who made resolutions in 2015 made the resolution to spend less and save more. This was the fourth most popular resolution behind staying fit and healthy, losing weight, and enjoying life to its fullest. Clearly, having a little more money is important to people.
As a side note, saving some money doesn’t necessarily have to conflict with the other goals. You don’t need an expensive gym membership to stay fit or lose weight. There are a lot of things you can do at your home.
Living life to its fullest doesn’t mean that you need to spend a lot of money either. If your idea of living life to the fullest means having a bunch of stuff like a fancy car or big house, I personally think you’ve gotten it wrong.
Let’s get back to resolutions. In my opinion, resolutions are a type of goal and that aligns very well with what this site is about. I believe in setting goals and actively pursuing them even if I don’t set many New Years resolutions.
A lot of people are setting this goal to spend less and save more, but we know they aren’t accomplishing it because the savings rate in the United States is abysmal. Why are so many people failing? I think there are several reasons – here are a few of them.
Spending less and saving more sounds simple, and you might think it is specific. You’re going to spend less, and clearly by spending less you should save more. But I think you should figure out how much less are you going to spend.
Are you going to save an additional $50, $100, $250 or more per month? Get more specific with your goals!
Failing to Plan
This one can be caused by vague resolutions because it is hard to plan for something that isn’t somewhat specific, but you can also fail to plan for specific resolutions. How are you going to save that additional $100 or $250 per month?
I think a budget is great tool for planning how much less you’ll spend! You can figure out which areas you are spending too much and work on decreasing the amount you spend there.
Lack of Support
It can be a lot harder to accomplish goals if you don’t have anybody supporting you. Talk to your spouse or find somebody else who is trying to save money – there are a lot of people trying to do it. Encourage each other and keep each other accountable!
So you messed up and didn’t end up saving as much as you wanted this past month – it really isn’t a huge deal. You don’t need to beat yourself up over it and negativity drains energy. You don’t have to be perfect because mistakes will happen!
However, you should figure out where you went wrong and how you can fix it in the future. Mistakes make a good way to learn and you can be patient with yourself.
Failing to Change the way you Think
To make a big difference in how you spend money, you’ve really got to change the way you think. You’ve really got to start thinking whether things you purchase are really going to add something to your life! This applies to everything, not just to impulse purchases.
Another great way to change the way you think is to find cheaper alternatives to things you enjoy. Hanging out with friends at home can be cheaper than going out. If you enjoy reading, you can use the library rather than buying books. Think about what you enjoy that is costing you money and figure out alternatives.
There may be other issues getting in your way, but I think I’ve covered several of the major issues. I believe that spending less and saving more is a worthwhile goal, and most people are capable of pursuing it! You just need to make a plan and actively pursue it even if it is just baby steps!