When it comes to your finances, positive affirmations, a willingness to learn, and a good attitude are a plus. However, none of these attributes will help you grow your bank account unless you back them up with some action.
To add to that, far too many people are plagued with bad financial habits as well. Whether it boils down to overspending, not being realistic, or not setting goals, it’s much easier to bury your head in the sand than to make an uncomfortable change.
6 Reasons You’re Not Saving Money
If you’re not saving money, the first question to answer is “why?” If you’re drawing a blank, here are six possible scenarios that might apply in your situation:
You’re wasting money haphazardly.
If you’re spending all you make or more each month, you should do your best to locate your “budget drains,” says Peter Huminski, President and Wealth Advisor at Thorium Wealth Management.
Wasteful spending can come in many different forms, and it’s not the same for each person. For someone, weekly stops at the local mall might be a problem. For another, it might be an addiction to pricey electronics and gadgets.
For a large percentage of people, however, it’s food spending that’s to blame for their money troubles. If you’re heading out to a restaurant for lunch each day, for example, you could literally be eating your savings away.
“Stop going to out to lunch at work and bring your own lunch,” says Huminski. “If you have a job that is conducive to bringing your own lunch, you can save over $50 per week. That is $2,600 per year. If you do it for 10 years you would have saved over $26,000 and you will be healthier as well.”
You don’t have any goals.
According to financial planner Joseph Carbone, Jr. of Focus Planning Group, not having goals hurts more than people realize. When it comes to retirement planning, for example, people often contribute enough to get their company’s 401(k) match to feel good, yet don’t have a clue if their retirement savings will be enough. And the same can be true for any of their other savings goals, whether it’s saving up the down payment for a house, saving for a new car, or simply building an emergency fund.
If you’re going to save towards a goal – and you should, Carbone suggests starting with the end in mind then working backwards. For example, after fiddling around with a retirement calculator and speaking with your financial advisor, you might figure you need $2 million dollars to retire. If you have thirty years left until you reach retirement age, you should determine how much you need to invest each month – and how much your investments need to earn along the way.
“If you don’t go through this simple task, you need not even bother to start working toward this kind of goal because you’re setting yourself up to fail,” says Carbone.
You’re not taking action.
Often times, people honestly …read more
Read more here: 6 Reasons You’re Failing At Saving Money