Just the other day, I heard someone make the statement, “As soon as I know I can’t have it, I want it. Suddenly it’s all I can think about.” I assumed she was talking about dieting and wanting one of the doughnuts that were sitting piled on a plate in the breakroom. Nope.
As I eavesdropped further, it became apparent that she was a victim of the frugality that has become the “new black,” as they say. She wanted to buy something. She was trying to save money, which meant she couldn’t have the thing she wanted. Suddenly, that item went from a casual “want” to a desperate, must-have, twitchy-to-get-your-fingers-on-it need.
Saving isn’t a lot of fun. Just as when you first start eating better and exercising more, the payoffs haven’t shown up yet, and it’s difficult to convince yourself to stay the course.
There’s got to be an easier way. Until you start seeing results, until saving becomes a habit, how do you trick yourself into being strong and disciplined?
The trick to saving, I think, is being realistic. Don’t swear to save $500 a month if you can really only spare $50. However, having said that, realistic works both ways–don’t promise to save too much, but also don’t allow yourself to save too little.
Here are a few ways to fool yourself–fiscally.
1. Don’t count the change. This may not work for people who want or need to have a perfectly balanced checkbook every month, but I like to round up what I spend and round down what I deposit every time I enter an item in my checkbook register. When I have a receipt for $13.44 for groceries, I round up and subtract $14. When I deposit a check for $25.75, I round down and add $25. These “invisible” savings provide a little personal overdraft protection, and they also are virtually unspendable. I don’t know how much extra is in there, so I have to abide by what’s written and forget the rest.
2. Deposit distribution. I automatically shunt $50 per paycheck to a savings account or investment account. My logic (for what it’s worth): if I don’t see it, I don’t spend it. If I find I can cruise along fine without that $50, maybe next month I’ll bump it up to $60 or $75. It’s still my money; I can still access it if I need it, but I find that when I do this, I generally don’t need it as much as I’d feared I would.
3. Carry big bills. I realize this sounds a little counter-intuitive, but there have actually been studies that show people are far more reluctant to break a big bill than spend a little one, even to buy exactly the same thing. One $20 bill will last a lot longer in my wallet than a couple of $5’s and a smattering of $1’s.
4. Save unexpected money. Was Grandma surprisingly generous this birthday? Did you get a nice rebate for that environmentally friendly washing machine you just bought? Stash the cash. Immediately. You weren’t expecting it, you don’t need it, you had planned to live without it, so it won’t hurt at all if you save it rather than spend it.
These are a few things I (try to) do to bulk up my savings a bit. What tricks work for you? Please share in our comments so that everyone can benefit from your brilliance!