Do the words 'save money' send a shudder down your back?
Well you're not alone!
When we are constantly bombarded with financial tips like 'have an emergency fund which is around 3-6 months of your living expenses', it can leave you feeling like....
We totally get it, 3 months - 6 months worth of expenses is A LOT. So when you are told to save near enough 4 or 5 digits as an emergency fund, it can be overwhelming. And then on top of that, no-one is born a good saver (we said it)...sadly, as babies, none of us are in the cot with a #frugalmindset - it's something we learn throughout our life, are influenced by and actively make a decision to work on.
However, have you often been put off by saving money because you think you are 'bad at it' - well, newsflash - you're not! You just need to train yourself to save more and here's how...
Tell your brain you are good at saving
Your brain is more powerful than you think. When you often tell yourself 'I'm rubbish at this' your brain then focusses on the negative things and before you know it, you are not trying to save. This negativity bias has a serious implication to your productivity. Tell your brain 'I can do this' or 'I am good at saving' as opposed to all the negative things you tell your brain and see how far you get.
Set realistic saving goals
If we go back to what we said earlier, having a 3-6 month emergency fund can amount to around £12,000 - which is a lot when you start saving from 0. And that can be incredibly off-putting and leave you not knowing where to start. One way to get around this is by breaking down your goals into simple, realistic mini goals. Instead of it being £12,000 you need to save, have your goal as saving £1000 then work your way up to the larger number.
Use round up apps to save spare change
The best type of saving is when you don't even realise it's happening and that's why we love rounding up apps. Here's how they work...
1. Connect your debit or credit card to a round up app
2. When you spend £2.40 on a cup of coffee, your app rounds up the coffee purchase to the nearest pound, in this case £3
3. Letting you save the difference e.g. 60p
A couple of apps that use the round up features are: Monzo, Moneybox & Chime.
Treat your savings like a bill
Heard of the phrase 'pay yourself first'? We're totally here for it. Paying yourself first is the act of allocating a certain amount of your salary or income to your bills, savings and investments as SOON as you get paid. This allows you to prioritise your money and spend on the most important issues first. Instead spending your pay on Nike trainers, Gucci belts and Dior perfume, and THEN deciding you will save what is left. By treating your savings as a bill and ensuring they are put into a separate account on a certain day (ideally your payday), you're switching the priority when it comes to saving.
It's a personal finance strategy that works every single time.
Lock your savings away
Back in the day, your grandparents may have spoken about putting money under their bed and not touching it until it's really needed.
The concept of what our grandparents did is 100% correct, the execution - not so much. Instead of putting your money under your bed (because, let's be honest it's not 100% safe nor does your money earn interest when it's in the 'bank of bed'), put your money in a bank account that requires you to give notice when you want to withdraw your money (for example a 95 day notice period). This means you can't get your money right away and won't be tempted to dip into it.
Make savings fun
When you think of fun things, you think of cocktails, beaches and games - not savings....
HOWEVER, that doesn't mean savings have to be boring and there are ways to make them fun through turning them into a challenge or making it into a game. The 1p saving challenge or the £10 challenge will help you turn something mundane into something more fun. Or have a swear jar, whenever you utter a swear word, a pound goes into the jar. It's a challenging and fun way to rack up those funds. And it's even better if you have a friend to do it with. Did someone say competition?
Fempire Finance