Basic financial skills, like creating a budget and starting a savings plan, may seem easy. However, much like eating well and exercising, taking action is often easier said than done. We know what we’re supposed to do, but we don’t always do it. It could be because these things take willpower, and science has proven that willpower is finite, much like gas in a tank. When you wake up in the morning, your willpower tank is full. But throughout the day, it may become depleted.
Saving money may not be top-of-mind, especially while making so many other daily choices. Choosing spending over savings can happen more easily if your willpower tank is empty. For example, when you get home after a long day of work, choosing to eat out over cooking at home is all too easy.
You can improve your willpower by addressing the mindset around your financial behaviors. Here are a few tips you can use to boost your willpower and help save more!
Know your worth: Add up all the time you spend on work, including dressing, commuting and answering emails before bed. Then divide those hours into your salary. That’s your real hourly wage. You can use this to measure how much your time is worth against whatever tempts you to spend.
Next time you’re thinking of bailing on your budget, calculate how many hours you’ll have to work to pay for the splurge.
Focus on the now: It’s easier to procrastinate if you think you have plenty of time to accomplish something. The thrill of impending deadlines is what jumpstarts some people into action. For others, a carefully crafted timeline helps them stay motivated. Whether you are a crammer, a planner, or somewhere in between, it might help to break down your big savings goals into a daily savings goal.
Write your goals down and keep them visible to remind you what you’re working towards. Each day, make a plan to do something that will help you make progress towards them. Focusing on saving money each day can help you take steady steps toward your greater savings goals — just be sure to transfer it into your savings.
Have a Plan B: Having both a solid savings plan and a good emergency fund can help you navigate financial uncertainty and provide you with a backup plan. Financial wellness is truly about having choices. The more you build your savings, the more your options open up, especially when faced with difficult financial decisions. For example, the option to take a break from your career to care for children or aging parents may be possible if you have a solid financial backup plan. Or, perhaps, you want to have more or better housing options now or in the future. A good savings will open up your housing options so home buying or renting is less stressful and more affordable.
Think about your backup plan when you are tempted to dip into your savings. If the purchase would substantially impact your ability to save, ask yourself if it is really worth it. This simple thought process can help you make choices that align with your financial and life goals.
Get to know your financial goals inside and out and think of them daily. With savings top-of-mind, you may come up with new tricks that work for you and your lifestyle!