Savings Fanned: Why most are missing mark on saving money

Posted By: Matt in Saving on 04/20/2017 at 13:03:36

We just can't seem to get it right, can we·

The "we" in that sentiment is the general public, the masses and just about everyone who collects a paycheck every week or two.

The "it" focuses on saving money, specifically having a budget and spending accordingly with the ability to put an emergency fund together so that you can save for unexpected expenses, that rainy day or something as important as retirement.

So why is it we can't save money·

Before answering that question, the cold, hard stats should be equally addressed. Less than half of the population in the United States is saving between five and seven percent of their income, money that should be used for a savings account. The general rule of thumb is that you should be saving about 10 to 15 percent of your salary with every paycheck.

And sadly, we're not even close to that number or the total percentage of people actually able to save anything at all.

Financial experts can bat around this theory about saving money and budgeting all they want but two key contributors are what drive our ability to save: automatic deductions and the economy.

If you want to save money, you should make it a point to put aside that 10 or 15 percent automatically with each paycheck and then stop thinking about that money altogether. You have to act as though you don't have it whatsoever, almost as if paying yourself that percentage is like paying another bill. You wouldn't ask Verizon for their cell phone bill back so why should this be any different·

Economically speaking, the better the economy is the more we tend to spend, so the minute you start feeling overconfident about your financial situation, you have to reign in that propensity and penchant to want to forget about counting pennies and instead start spending and charging at a moment's notice.

The lack of a savings account or emergency fund only adds to the plight put forth by those who are trying to save. The proverbial "catch 22" is that if you don't have money to put aside because you have to pay bills, then you can't even think about having a savings account and thus the struggle continues.

The only way to have money to put aside is to rethink and retool your budget so that you can cut expenses and start having money leftover to save. The budgeting part of this equation has to be recognized as the real catalyst to catch up what time you've lost living at or beyond your means.


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