Saving more money is a pretty common goal, but for many of us it seems like an impossible task. No matter how hard we try, our bank accounts never seem to grow. Is it possible that even with our best intentions we continue to make common money mistakes?
Let’s be honest, we’re wired to spend. Going out is fun, buying new clothes is strangely addictive, and who doesn’t like showing off their new purchases? It doesn’t help that for the most of us, we’ve never been taught how to manage our money. Even though we want to save more, we’re practically at a disadvantage to begin with.
We may not realize it, but it’s the common money mistakes we make that are preventing us from saving more.
Money mistakes to avoid
Blowing your raise – When we get a raise, our natural instinct is to start spending more. I really don’t understand this, yes a raise means we have more disposable income, but it’s not like our expenses have increased as well. I’m not saying we should save every extra dollar, but if we can manage to live on the same budget as our first jobs, then saving money becomes so much easier with every raise.
Saying you can afford it – It doesn’t matter how much money we make, if we’re spending more than we make, we can’t possibly be saving. Do we really need that second glass of wine? or wine at all for that matter? Believing that we can afford things is one of the common money mistakes we make that really prevents us from saving. Okay technically we could afford it, but it’s probably a better idea to cut back on things so we can save more.
Not having a budget – Rich or poor, having a budget is vital for everyone. Without a budget it’s just too simple to lose track of where all our hard earned cash is going. One key thing to remember is to pay ourselves first. What that means is; we should be budgeting savings before anything else, well that and bills of course. If there’s any money left over by all means spend it, but we need to prioritize our savings.
Ignoring your spending – This should be obvious, but if we’re ignoring our spending, how exactly do we plan on saving anything? The easiest way to take control of this is to start tracking our spending. Write down everything you spend money on for a month or two and you’ll get a clear picture of where your money is going. With this information hand, we can start making cuts to our spending and create a realistic budget.
Not saving enough – Saving can be tricky, how do we know when we’re saving enough? Saving $100 a month sounds good in principal, but that’s barely enough to cover our emergency fund. If an emergency does come up then all our savings will potentially be blown. Saving 10% of our income used to be a good start, but these days if we can get our savings rate closer to 25%, we’ll be in much better shape.
Paying fees – Paying unnecessary fees are the worst! What I hate most about them is how they creep up on us if we’re not paying attention. Cutting fees should be a priority when we’re trying to save. Banks are notorious for charging excessive fees– account fees, ATM fees, and service charges should be avoided at all costs.Related: 9 Fees to cut from your daily life
Refusing to shop around – This is probably one of those common money mistakes that we make for no real reason. I don’t know if it’s pride or something else, but why wouldn’t you want to shop around? Why spend more when you don’t have too? By shopping at discount grocery stores, we can instantly save 10-25% off our grocery bills. It’s not like we’re buying no name products, we can get the exact same products at a lower price, so why wouldn’t we take advantage of the savings?
These common money mistakes happen all the time regardless so don’t get discouraged if you’re guilty of a few things on this list. The key is to recognize what you can do better and start working towards your savings goals. More importantly, don’t procrastinate, start saving now!
Lastly, saving more money is always a great idea, but if you happen to be in debt, it’s probably a better idea to clear your debts before you start saving. It’s near impossible to save anything if you’re carrying a balance on your credit cards. Once you clear your debts, you won’t believe how easy it is to save money.