Increasing your savings is not the easiest task in the world. You will find that spending is easier than reaching your saving goals. This is probably why a lot of people are having a tough time boosting their funds in the bank.
But despite the difficulty, there are instances in our lives that we are required to save. For instance, if you wish to buy a home you need to save up for a down payment. According to an article published on MoneyTalksNews.com, approximately 1 out of 8 Americans are expected to have a six figure income in order to qualify for a home loan. At least, this is true based on the median price of homes for sale in the country. Obviously, this puts a lot of Americans at a disadvantage. In most cases, the median income in states is lower than the minimum income requirement for median priced houses.
However, the article explained that in order to make the minimum income requirement lower, homebuyers should do one thing – pay a bigger down payment. The bigger the down payment that you will provide, the lower home loan you have to borrow. That means the minimum income that you need to have can be lower too.
Unless you are waiting for some inheritance or big bonus, the only way for you to get this money is to save up for it. Since this down payment is a somewhat huge amount, you need to put some effort into increasing your savings. Otherwise, it will take you forever to finish completing your saving goals.
3 reminders when you feel discouraged about your savings
Having a saving goal is one thing. Reaching it is another. You may want to keep yourself from feeling discouraged because it will make you lose the motivation to increase your savings.
According to Statista.com, the personal savings rate of Americans, as of June 2014, is only at 5.4%. And in 2013, the American households who were able to save s only 53% of the population. Although the country is exhibiting signs of economic recovery, we all need to save to make our personal financial future more secure. In case something happens, you will not be as financially distressed as you will be if you do not have any savings at all.
But of course, you need to address the problem of a possible discouragement in the midst of your saving goal. Increasing your savings mean you have to make some sacrifices in your life. After all, increasing your extra money for savings would mean cutting back on expenses or spending more time at work. These sacrifices can affect your motivation to meet your saving target. If things get too tough, you might find yourself giving up altogether. And we all know giving up on your savings is not an option. Otherwise, you can say goodbye to that new home or embrace a lifelong servitude to debt.
In case you are in the midst of a saving goal and you feel discouragement creeping up on you, here are a couple of things that you may want to tell yourself.
Saving takes time.
First of all, saving really takes time. This is why consumers are always advised to start saving now. Regardless if you can only save a small amount, it does not matter. The important thing is to start on the habit of saving because that will accumulate into a big amount in the future. And when you look at your savings and you see only a small amount there, do not feel discouraged too. If you are only putting in a small amount, increasing your savings will naturally be slow going too.
Saving requires effort.
Another reminder that you need to tell yourself is that saving really requires effort. Even if you are earning a big amount, you will need to change something about your life if saving does not come naturally for you. It will either be your spending or your work effort. That is a given. You need to exert some time to boost your savings. It will not just happen unless you plan and execute it. The compulsion to spend is just too great that you will find yourself battling with yourself time and again. You have to get used to it until such time that you develop the right amount of self control.
Saving has future rewards.
Lastly, you have to focus on the fact that your savings have future rewards. You will not feel it now but you will reap it in the future. It may be that new home, a car, or your early retirement. These will only be felt in the future so you need to develop some patience. The earliest reward that you will probably feel is the satisfaction and security – knowing that everyday or every deposit that you make towards your savings will bring you one step closer to your goal.
Focus on these three reminders whenever you feel like giving up on your saving goal. These should give you the motivation to continue increasing your savings.
Tips to boost your savings
In case you want to speed up your savings so you can reach your goal faster, there are a couple of things that you need to do. After all, seeing how fast your savings are growing will give you that motivation to keep on putting money into your account. This motivation, once you have secured it in your mind will keep discouragement at bay and will not hinder you from your financial targets.
An article published on AllThingsFrugal.com mentioned that one of the reasons why some people fail at saving is because they feel they do not have enough. In truth, you will never feel like you have enough to save unless you decide on a specific amount to put aside. This is the most common excuse to not save. But just as we mentioned previously, a small amount is enough – as long as you are saving.
Here are a couple of tips to help you increase your savings.
- Set a saving goal. When you are trying to improve something in your life, make sure that you set specific goals. A vague goal will not encourage you to complete it. But if you have a specific timeline and an amount on your list, your chances of reaching your goal will be more likely to happen.
- Cut back on your expenses. If you want a fast option to increasing your savings, you may want to lower your monthly expenses and put away the freed amount in your account. Technically, this is money that you already have. It is usually easier to pull back than to push forward anyway. So if the need to save more is immediate, this is an option that you may want to prioritize.
- Earn more money. While the previous is the faster option to boost your savings, it is also limited. That is why you need to follow it up with earning more money – especially when the amount you need is significant.
- Treat your savings like a bill. Lastly, you may want to treat your savings like a bill so you will never miss out on a contribution. A lot of people spend their money first and whatever is left will be put into their savings. In most cases, nothing is left at the end of the month. But if you treat your savings like a bill, you should be able to reach your saving goal soon enough.
Follow these tips and you will realize how increasing your savings is not really that complicate. As long as you are committed to the task at hand, it should all fall into place and you will soon have the amount that you need.