Question from a reader:
“How you do find the inspiration to keep saving money even when you don’t want to? I’m debt free and paying off my mortgage in the next 5 years (instead of the next 29 years!) so I’m looking for some extra inspiration. Thank you!”
Here’s my answer (feel free to include yours in the comment section below):
Congrats on being debt free (including the house soon).
I find that when I tie my finances to my dreams and goals in life it’s pretty easy to stay motivated to save. I have a ton of dreams and goals. Things like:
- quitting the rat race,
- building successful businesses,
- spending more time with my kids,
- putting them in good schools and programs,
- traveling and seeing the world,
- retiring without worry, and
- helping others with my wealth.
The list goes on, but you get the point. All of these things are tied to my ability to successfully manage (and save) money. I sit down usually once a year and re-assess where I am with my dreams and goals and add new things to the list. There’s always something else to save for it seems.
I suggest you do the same – think about what you really want in life, and write down the logical financial steps that it will take to get there. When you use your actual dreams and long-term desires to run the show, you’ll always be heading in the right direction.
Also, and maybe more importantly, saving shouldn’t require constant inspiration. That’s what automation is for..set it and forget it. Once you figure out your goals with money, create automatic transfers to savings/investing accounts tied to each of these goals. The saving will take care of itself.
If you don’t have automatic saving setup, stop down right now and make a plan to get that setup. All it takes is an email to your human resource department, or clicking a few buttons at your bank’s website. If you’re bank won’t automate, then find one that will.
If you are saving just to hoard money (without an end goal – either because you ran out of goals or you never set any to begin with), then it’s time to stop and evaluate your motivations. If there is another goal to add to your list then do it. If not, then allocate more of your money to spending or giving it to charity. I’ll gladly take some off of your hands.
Where I struggle is when my income goes up, I tend to not focus on the small savings as much. Is that what you meant? If so, I don’t have a good answer…I stink at that. Being self-employed makes it even harder. Lifestyle inflation is a constant battle for me and I just do the best I can and like I said above, I make sure the big things are automated and I’m free to spend the rest, no matter how much.
What’s your response to this reader question?
Image by Steven Depolo