I don’t know an adult who would consider competing in the next marathon if his last sporting achievement was when he had to run behind a yellow bus.
It is hardly more realistic to aim overnight at a savings rate of 25% if you have always seen the end of your paycheck.
Saving is like sport
When it’s not “natural” or you haven’t practiced it for years, you don’t get much pleasure from it at first.
Better to set modest goals, otherwise you increase the risk of failure.
I warn you, because the month of January lends itself to resolutions. Okay, this is no ordinary start to the year, and maybe you have something else on your mind …
Or on the contrary, since you are limited in what you can do, you tell yourself that this is the opportunity to give it a go. And you are more motivated than ever.
Warning ! You know what motivation is like. It comes in a jam and it slowly deflates. It is not long before overly ambitious goals take the edge, destroying at the same time what remains of will.
Limit your ardor, focus on targets that you can maintain.
Here is my plan for couch potatoes savings:
1. For now, don’t worry about delays you may have accumulated in your retirement savings or your overall financial situation. The overall picture may seem daunting. You won’t solve the problem in a snap, you have to build the foundations first: integrate the savings habit.
2. Before setting a goal, take a detailed inventory of your expenses. Eventually, it is on the basis of this information that you will have to make choices.
3. Among these expenses, identify those that are not essential. Rank the others in order of importance to you and your family. There are some that you can completely cut, others that you can reduce. Cut in certain subscriptions, negotiate your communications plans, check if it is not possible to reduce your bank charges.
4. At first, set small goals that you can easily achieve. Save half of your pay raise, tax refund or bonus.
5. You need to set a concrete and realistic target. “Saving more” or “being financially independent” are not clear goals. “Putting aside $ 200 per month” or “saving 1% of your salary” is much more tangible.
6. It is child’s play to schedule transfers between financial institutions. Open an account in a virtual bank. Whether it’s $ 25, $ 50, or $ 100, schedule an automatic transfer to that savings account every time a paycheck comes in.
If you are carrying balances on your credit card, you need to tackle those debts first because interest is expensive.
Reaching modest goals preserves motivation. When you feel in control, take your goals up a notch or two.