Friday, May 29, 2015

Saving as a Lifestyle Change

In many ways saving money is like being on a diet. Diets are temporary and can cause weight loss over a short period of time. Then after you reach your goal, you tend to go back to old eating habits and end up gaining the weight back.

Many personal trainers and fitness magazines will tell you not to diet, but to make a lifestyle change. Changing your lifestyle and eating habits permanently will cause you to keep the weight off and reach your fitness goals.

Saving money is the same way. If you say, "I am going to save up $1000 for an emergency fund," what happens after you reach that goal? Some people stop saving like they did before and end up going back to old spending habits. Savings has to be a lifestyle change, but within reason. No one can expect to save huge amounts of money over long periods of time by resisting any splurge.

As with dieting, if you deprive yourself of chocolate for several weeks, you will end up breaking down at some point to binge eat brownies or cakes or sweets and then feel guilty about it later. Giving yourself small splurges throughout reaching your savings goals will help you to stay motivated and stay on track.

It's also important to have realistic expectations. If the "miracle diet" consists of eating cauliflower at every meal, but you hate cauliflower, you are setting yourself up to fail. You have to look at saving money the same way. If you absolutely love the conditioner you use on your hair and hate using cheaper conditioners because they make your hair look bad, don't stop using what you love just to save money. You may end up spending more money in the long run by trying to find the perfect "cheap" conditioner and end up with several wasted bottles of conditioner in the process.

Buy generic when you can. If you can get away with using generic for items that perform the same function, you will end up saving money in the long run, but still have the money to spend on the things that you love so it does not feel like a sacrifice.

Figure out what your splurges will be in advance so there are no impulse splurges that have you asking "What happened?" $200 later. A splurge can be something as small as a tube of mascara, a movie out with friends, or a dinner out Anything that you can think of that won't cause you to binge spend later and stay motivated.

You can always do a spending fast where you go periods of time without spending anything, but make sure that you don't do it for long periods of time.

When people find the right diet that works for them and the weight seems to fall off, if you find the right savings plan that works for you, the debt will seem to fall right off.