The Art of Saving Money: 5 Most Common Mistakes

There are many ways to save money, but even the best strategies can make mistakes.

At first glance, each savings strategy is quite clear and simple, but as soon as it comes to actually putting money aside, all the nuances “come to light”.

Below are five of the most popular strategies for saving money, which in essence are the main and common mistakes in this matter.

Put aside the rest of the funds

It seems that the strategy itself is not so bad - everything that is left from the main expenses can be put into a piggy bank either for a "rainy day" or for some purpose. But the amount of money set aside can be quite different every month, and it may be that there is no money left at all.

To make payments for savings regular, it is better to put money aside right from your salary. You can set up an automatic payment from a card to a savings account, or promise yourself that such a payment will be postponed each time.

Of course, you should only make such savings if you are confident that the remaining money will be enough to pay mandatory payments and other necessary expense items.

Transferring money to a savings account

It seems that everything is in order here, but it is easy to withdraw money from a savings account, which is a very big temptation for a person.

After all, you only need to press a couple of keys, and money can be spent on completely unnecessary things (for example, in the case of impulsive purchases, the item itself is not really needed, but at that very moment the person really wants it).

In this case, it is better to open a deposit account in a bank from which you will not be able to withdraw money before the due date. Then there will be no such temptation.

Savings are stored in one account

If there is one goal for savings, then this is a good strategy. But when there are several goals, then it becomes difficult to track savings specifically for each.

There is only one conclusion: create several savings accounts and determine for yourself how much money you need to transfer and where you need to transfer it each month.

Accumulating large amounts of money on an ad hoc basis

If a person saves money only when money comes to him by chance (for example, one month he puts aside his entire bonus, the second month – nothing, and the third month – money from his part-time job), then he does not have a clear savings structure.

In this case, it is better to put aside smaller amounts, but every month. And if you manage to put aside more, then do so. But some specific amount of money for savings should still be set.

Put aside all the money that remains free

Don't forget that every person needs rest. And don't get hung up on savings.

Sometimes you can skip a payment if you have very little money and it is barely enough to cover your essential needs. However, if you miss a payment, you still need to pay this money either the next month or as an addition to future payments.

Thus, accumulation strategies will not work unless they are viewed as potential errors. The accumulation ideas themselves are good, but each of them requires some adjustment.

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• 4 July 2024

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