To Spend Or Not To Spend? Either Way, You Could Have A Problem

2018-10-01T09:56:37+00:00

Saving is never easy. Most us struggle to keep the pot topped up above more than $100 each month. With money set aside, the temptation to dip in when things get tight is too much to ignore. Before we know, our efforts do nothing more than tide us over from one payday to the next. We certainly don’t end up with anything to show for our efforts.

On the other end of the spectrum, you have people who save for saving’s sake. On the outside, it looks like they have it together. When it comes down to it, though, they’ve become so addicted to saving that they don’t dip into that money at all. Even during emergencies. In this instance, you have to ask yourself what the purpose of saving is in the first place.

It doesn’t take a genius to work out that either of these methods is off-track. What you might not realize is that the same points can get both types of savers where they need to be. That may come as a surprise given how different each method appears on the outside. When it comes down to it, though, getting on top of savings is about keeping ultimate goals in mind. And, we’re going to look at some pointers which can help either end of the spectrum do just that.

Recognize which side you fall on

Of course, the first step is to recognize which side of the savings coin you fall on. Only then can you address your issue accordingly. Be honest, then, about how you treat your savings. Are you too willing, or not willing at all, to dip into the pot? Do you stop yourself from building savings because you always spend? Or do you prevent yourself from turning to this security when you really should? Over the course of a month, take note of your habits here. If you head to your savings often, you’re clearly in the first category. If you don’t even allow yourself to consider they exist, you’re in the latter. Notice how this impacts your life. Do you rely on those savings to make up for your financial shortcomings? Do you stress yourself out due to a fear of spending them? Either way, knowing about these behaviors is the best chance of overcoming them. They do say, after all, that the first step to recovery is admitting you have a problem.

Remember what ‘emergency savings’ are for

It’s also essential for both these groups to remember what their emergency savings are for. On the one hand, this means acknowledging that clothes do not consist as emergency stuff. Even a new fridge isn’t an emergency if your old one still does its job. It may be a future goal to save for on the side. But, it shouldn’t involve dipping into your primary fund. Equally, it’s important to acknowledge when you can use that money. If something in your house breaks down, for instance, you shouldn’t hesitate to spend money on repairs. If your boiler breaks down, phone someone to repair it the same day. If your car stops working, call West County Volvo or another company like them, and get a replacement straight away. If it helps, write down a list of emergency expenses, and return to them when in doubt. You could do real damage to your prospects here at either end of the spectrum. As such, being clear about your goals and allowances could be the best option to see you through.

Don’t be afraid to invest in your future

Speaking of being precise about allowances, it’s also worth noting which investments will come back to you in the future. This is a fantastic way of both ensuring you’re spending in the right places, and permitting yourself to do so. Often, it’s possible to put your savings into something which could earn you more down the line. And, that’s a cause any saver should want to get behind. In some sense, you could say that this is a way to both spend and continue saving at the same time. An obvious option here would be to get stuck into stocks, though that’s by no means a guaranteed investment. If you want to play it safe, you may be better off putting your savings into something like property or business. While you need to put in to get out, you stand to see significant returns on either of these options. Even better, the spenders get the chance to spend, and the savers get to feel like they’re still saving their money. You could find, then, that options like these become the ideal compromise.

Set yourself a low saving minimum

In both cases, it’s also worth setting a low savings minimum. This is important for both keeping a savings foundation, and ensuring you keep earning interest on what you put away. Your savings are an investment in themselves, after all. This is also a useful guide marker for either type of saver. For those who struggle to keep the pot topped, a minimum amount ensures you grow more disciplined in leaving something in your fund pot. That foundation alone can build the structures for a decent savings fund from now on. At the very least, it ensures you always have a small amount set aside. For those who struggle to spend their savings, this could act as approval of sorts. When you have the minimum amount in your mind, you may feel more able to spend anything above that marker. This will allow you to rest easy that nothing will obliterate your savings. And, that’s often all it takes to break your block here. This amount can be as low $100 if that’s all you think you manage. If you’re worried that’s too low, consider keeping $1000 in your savings at all times. Either way, having this limit can take a considerable weight of any saver’s mind. That, in turn, should lead to healthier habits down the line.

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