Saving is a really great thing. Most people have trouble saving their money because it’s delayed gratification. But, if this first step is hard, the second can be equally so; saving for a goal. Setting the saving goal can also be the worst offense, as we save to save. You know who you are…. You put your money in the bank and never spend it. If you ever do spend it, it will usually be impulsive because you didn’t know what you were saving for.
The point of saving, is to save for a purpose. Let me preface this first, I used to be like this. I was raised to just save money for the sheer comfort that if something I wanted came up I could buy it. Nine out of 10 times it wasn’t something that I intended to buy, because it was an impulse purchase. I would literally search for things to buy because I had money saved up with no purpose. A very terrible thing in hindsight.
I never thought about saving for a purpose until I was in my twenties. I realized the money I had saved as a kid, which I still had, actually lost value. I put it in a savings account because my money would be safe and grow. Let’s just say inflation won that battle and I now decide with my wife what each penny is being saved for so I can maximize the value in different ways. We sit down and define our goals either by ourselves or with the help of a financial advisor. Sometimes outside perspective give us new ways to look at things and more importantly how to be efficient for what we intend to save for. Once we started saving for a purpose, the goals became real and gave us incentive to be consistent with our savings.
So I urge you, develop a purpose for why you are saving. Is it for a house down payment, a new car or your retirement? It could even be small scale items, a new TV, a new shirt, date nights or whatever it is you enjoy. Without an end goal in mind we lose focus and either stop saving or forget what it was we wanted.
For simplicity sake, think of a goal, save for it and then do it!