ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Three reasons why people can not save money

Updated on July 5, 2013

A lot of people may ask themselves, "Why is it so difficult to save money or economize better". It is something that can be so troublesome for some that they simply give up and continue on their money wasting habits.

There are a lot of articles you see on TV, Magazines which may look suspicious however they all tend to focus on one main point. They usually emphasize that you will be saving money without even realizing and you can because a lot more affluent than you think. This statement is very true, people are actually missing out on a lot if they fail to maintain decent savings.

Another popular statement is, "If you think about starting to save tomorrow, tomorrow will never come, you need to start right now".

Reason 1 - Setting Strict Limits on Saving

There can be many reasons why one has failed to save money until now. People will often blame themselves for not having the patience or perseverance needed to save money. This is not the correct attitude to have, also willpower and other similar mental preparations will not help you in your quest to save money.

The most important thing is to set very strict boundaries on money control, this means defining a strict border of what you can and can not spend.

For example, if you want to diet, you will never lose weight with willpower and mind over body control. However you will lose weight if you put strict control over the amount of food you eat, control the amount of times you eat out and set a limit to what you buy when you go shopping.

Reason 2 - Not having a concrete plan

This needs to be executed in steps as per below:

STEP 1: Write down your monthly salary and expenditures


Every single expense for the month needs to be noted. Try to put as much details into the expenditures as you can so you can make easy references to it later on.

STEP 2: Decide how much you want to save


The amount you want to save should be clearly stated in the early stages. So you should write how much money you want to save every month.

The main point here is, don't write down how much money you can save, but write down how much money you would like to save and work backwards with the calculations.

It's not really about wanting to save a certain percentage of your salary, it about defining a savings goal and working backwards with your daily expenses calculations. This is a very good way of determining what you really do and don't need in your monthly expenditures. It will become very clear to you want you need to cut out on in order to achieve the set goals.

The best way to think is for example, in two years if I want to buy a car for $10,000, how much do I need to safe per month, or moreover how much do I need to cut my current costs down.

STEP 3: Divide your expenses into four categories and single out the higher one


For example:

  1. Living costs (Rent, food, utilities)
  2. Society costs (Education, transport, insurance)
  3. Leisure (Clothes, travel, eating out, drinking etc.)
  4. The amount you would like to save

Now once these have been divided we can check to see how much money is really necessary. The way to do this is the subtract the amount you would like to save first, and then divide the rest with the other three categories. For example, if you are earning $2,500 a month but would like to save $300 dollars per month then the division will look like the below.

  1. $1,500
  2. $500
  3. $200
  4. $300

STEP 4: Divide the money into separate bank accounts


This is the ultimate way to put and boundary and limit on your expenditures. It may sound like a hassle to open four bank accounts but this is a very recommended method. Each of the points above should go into a separate account.

Please also note that there may need to be slight adjustments as realistically, expenditures can suddenly change. e.g. Summer vs Winter utility bills, events, parties, accidents.


Reason 3 - Withdrawing your savings

If you stick to this pattern monthly then you will naturally save money without even thinking. This method should get you into the habit of buying only what you need. It is very important that you never touch the saving account (Part 4 of the divided income).

Comments

    0 of 8192 characters used
    Post Comment

    • Hezekiah profile imageAUTHOR

      Hezekiah 

      5 years ago from Japan

      Thank you Kasman, it does work for a lot of people.

    • Kasman profile image

      Kas 

      5 years ago from Bartlett, Tennessee

      I do like your thoughts on this topic. I'm always on the lookout for better ways to save and I thought your backtracking idea on the item you want to buy is a good one! Voting up, sharing. Great job Hezekiah!

    • Hezekiah profile imageAUTHOR

      Hezekiah 

      5 years ago from Japan

      Hopefully this method will restrict you from buying unnecessary goods, thanks.

    • Zubair Ahmed profile image

      Zubair Ahmed 

      5 years ago

      Thank you for sharing, very useful info. Saving money takes time and control of ones emotions. That is something lacking in this 24hr society and want want attitude. People are not willing to overcome the initial desire of wanting something. IT is that desire that marketers and sales guy's target, causing people to buy things even though they really don't need it, leading to wasting money.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)