We’re halfway through January and it’s likely that your New Year resolutions are beginning to fade. Have you been indulging in a few guilty pleasures, or slacking off on that rigorous workout routine? Probably. And if you pledged to economize this year, it’s probable that you’re not holding firmly to your newly established budget. “This one coffee won’t create any harm,” you reassure yourself while stopping by Starbucks. Or you convince yourself that those winter boots in the sale are an absolute necessity!
These are the excuses we make to persist in our usual lifestyles. It’s so much easier to adhere to what we’re accustomed to, rather than endure discomfort and strive for a life that we know to be more rewarding.
When my spouse and I managed to pay over $45K in debt, it wasn’t a comfortable journey, but we fell back on our lifestyle as cash-strapped newlyweds. After clearing our debts and doubling our income, lifestyle inflation subtly crept into our lives. It became challenging to concentrate on executing our long-term objectives like saving for retirement, a new house, or our child’s future.
In 2017, we made the pledge to regain control of our financial habits and begin saving once again. Nevertheless, changing old habits has been a struggle. Here are three strategies we adopted to help us meet our savings targets this year:
1. **Budgeting Regularly:** Every Friday after work, I schedule time to review our budget. It is a suitable time for my spouse and I to relax, enjoy a glass of wine, and discuss our budget. This regular checkpoint allows us to track our weekly expenditure and plan for upcoming expenses, helping us maintain focus and not neglect our budget.
2. **Savings Segregation:** We split our savings among eight different Capital One 360 accounts. This online-only bank is exclusively used for savings, and it makes it more challenging to transfer funds between accounts. Each account is labeled for its designated purpose. It helps us visualize our savings’ targets and feel more motivated to save.
3. **Prioritizing Saving:** Instead of spending first, we save. As soon as we receive our salaries, funds are automatically transferred to our savings accounts. By saving first, we always ensure that we have surplus cash at the end of the month.
If you set financial goals for this year, you will need to follow these steps to achieve them. Now, what are your savings goals for this year, and what plans do you have in place to reach them?
