Saving, as widely seen as a good money management scheme is easier said than done. Even though it is a key to financial independence, many still finds it difficult to put some money aside. Not only does saving seems like the “right” thing to do, many of us can point to experiences in our own lives or in the lives of loved ones that shows the importance of saving. In some cases, savings reduces the effects of an unexpected expense or a lost job. Other times, savings support flexibility and a well-lived life, like taking the family on vacation or helping a friend in need. When you have cash savings to fall back on, your day-to-day financial decisions are easier, you have fewer worries, and you have more freedom to make choices that allow you to enjoy life.
We should save for a down payment. We should save to send our children to school. We should save towards our rent. We should save so that we might retire independently. So why is this still so difficult?
Here are some of the reasons why most people finds savings very hard;
1. Not tracking spending
As long as your account balance reads positive, you feel you are doing good. Even though you know your spending habit is way out of it, you don’t want to keep track. It’s one of those things you know you should do but loathe actually starting. You have to know where your money is going. There may be opportunities to reduce spending, cut back on certain expenses, and more that can help you start to save money.
2. Low income
The various cost of living daily outgrows salary hence making it difficult to actually set some money aside. But at the same time, you can increase how much money goes into your pocket at the end of the day. This could be by starting a side hustle or investing in income generating assets. There are several investment platforms with good returns such as Rentcrowdy – helps you invest into the rental market. You might not get rich at once but it sure helps put some money in your savings account.
3. Lifestyle Inflation
Just because you make more money does not mean you have to spend more money. If you get a raise, save the extra income. You don’t need those Armani shoes just yet. People tend to increase their spending by purchasing luxurious items, eating out at nicer restaurants, or buying high-end electronics. Even though it is important to not give in to lifestyle inflation, there is no issue with spending more if you make more. Just be sure to budget your money first.
4. Peer Pressure
We don’t all make the same amount of money. If you really want to start saving, don’t compare yourself to your friends. Misalignment of interests and hobbies often results in opting to spend more while around people instead of doing something at home or elsewhere, where it wouldn’t cost money. Imagine how much you could have saved.
When you try as hard as possible to keep up with that extravagant lifestyle, succumbing to peer pressure, you tend to fall into debts too easily. This is a principal reason why most people don’t save. They have so much debts eating into their income all the time.
When it comes to saving, there is a fair bit of due diligence required. Putting in the work is, however, not everyone’s cup of tea. This goes for savings options, investing options, free activities, and anything else that could make saving a usual activity. Most of the time information is not known. It’s hard to save money or invest when you don’t know what you are doing, right?
7. Don’t know how
You need to be learning new financial habits continually. The easiest way to start saving is to automate everything. There are several platforms that has automated saving features. Platforms such Kwaba allows you create specific target savings towards your rent and make sure you stay to this commitment until you reach your goal. You can’t be undecided along the way as they make sure you don’t fail to save at the estimated time. You can download the Kwaba mobile app to start saving here
The hardest part of saving is starting, it gradually becomes a habit. Watching your account balance grow would give you much happiness and motivation to work harder. It takes time to build wealth, and it’s not always easy to have the self-control to avoid spending your savings. Just keep learning new ways to do this. Regardless of how you save your money, we can all agree that it should be our top priority.
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