Are you a good saver? Few of us save enough money every month to maintain a reasonable level of financial security. Many seniors are forced to work well into their golden years. Adopting effective habits can make saving money considerably easier.

A few small changes might be all you need to have a financially abundant future.

Saving is a slow process and can require many years and the discipline of the Warrior archetype to see impressive results. However, your habits dramatically influence your results over time.

 

Become a successful saver by implementing these habits:

 

1. Savers pay themselves first. Our instincts can steer us in unproductive directions. Many of us feel compelled to pay all of our bills first ... before saving. Do you think "Income - Expenses = Saving"? Think again!

It is nice to be out from under the mental burden of bills and other financial obligations. Our Innocent which looks for safety is kept happy for a bit. But there is rarely anything left at the end of the month to put into savings if you think this way. Guess what will happen in a few weeks? You will feel unsafe or worried again.

Make a habit of saving a percentage of every dollar euro pound or peso you earn or receive. Start with 2% if that is all you can afford, and make an effort to increase the amount in the future. Avoid spending this money on anything else!

When you start doing this, you start internalizing the following formula "Income - Saving =    Expenses". Saving is a decision ... not the result of what happens after all your expenses.

           

2. Savers save automatically. It's much easier and more effective to simply have the money removed from your paycheck before you have the opportunity to spend it.

Most employers are willing to split your paycheck and send a portion to a separate account. This might be the easiest way to save. If you don't, make an automatic transfer from the account you get your paid to, towards an account that you won't touch (and ideally pays you some interest as well). Call me lazy if you want but I find that what is easy gets done, even if it is boring. Make Saving an automatic process so that it gets done, and you do not have to think too much about it.
 

3. Savers keep their spending in check. The less you spend, the easier it is to save. Go through your spending over the last month and determine if all your money was well spent. If it wasn't, carefully monitor your spending next month. Think about how much your spending is costing you.

It's reasonable to expect an annual return of 8-10% on your long-term investments. Every $100 or euro spent today would be worth nearly $700 or euro in 20 years if it had been invested. Spending $100 or euro when you were 20 years old, cost you nearly $7,300 or euro at 65 years of age. This is the power of compounding : use it to your advantage 

Shop with a list. We've all gone to the store for a couple of small things and come home with far more. Make a list of what you need and stick to it. This will help you keep the Fool archetype under control.
 

4. Savers avoid debt.

There is a smart way to use borrowing and leverage when you invest. Trying to save while in debt though, is like walking up a hill and never getting to the top. Consumer debt is an obstacle to achieving any financial goal. If you're unable to pay cash, you simply can't afford it.

Unless it's for something very important that needs to be paid for immediately in an emergency situation, avoid accumulating any unnecessary debt.

 

5. Savers have goals. Saving is easier if you have a clear picture of the reason.

The objective of a comfortable retirement or sending your child to a prestigious private school can help maintain your focus. What are you saving for? Motivation and purpose is super important and the minute you identify it, the saving journey gets easier and nicer.

 

6. Savers take regular measurements.

You will find that most savers are very aware of how much money is in their accounts and how much they have saved and spent. They are on top of their income and expenses. As the saying goes "what gets measured gets done!"
 

7. Savers are financially responsible in general.

They pay their bills on time. They know how much debt they are carrying. They have an emergency fund for the future (6 months is usually the amount I see being used). Do you know anyone that saves well, and the rest of their finances are a mess? Take responsibility for all aspects of your financial life. It will help you in many other aspects of your life by the way.
 

It is possible to save enough money to secure your future and retirement, the education of your children, or the house of your dream. Having more effective habits will enhance your results.

 

With a few minor adjustments and the right mindset, you can watch your savings grow.

 

Our lives are the result of our habits. Create habits that support your financial well-being and make Money work for you (and do not become the one who needs to work for Money)