Is Your Money Flying Out the Window?

by Tuesday, April 19, 2016

Most people will tell you that they find it odd that they cannot seem to grow money in their savings account enough though they strategically ensure ways to cut spending their money. You are not the only one that feels this way. It’s the most common issue that people struggle with today.

People can start to feel frustrated when they have the willpower to save, but the results don’t reflect the effort. When this happens, people will become discouraged from wanting to continue then stop, and this cycle can be quite a dangerous one.

Saving your cash and not spending your cash are completely different things. Most believe they are the same. There are various forms of the “no spending, not matching savings” issues. Let’s say, for example, you choose to make your lunch at home and take it to work with you over the next few days so you can save yourself some money. However, you notice two weeks later, you savings account is no higher from the time you started. Or how about when you are ecstatic that gas prices are lower, which could are decreasing which you know will translate into a reduction of spending gas by $160 each month. In both of these instances, you only took half the necessary steps you should be doing to save cash.

Let’s take a deeper look as to why not spending your money doesn’t equate to savings. The true culprit is online banking. From the time banks have come into existence, they’ve altered the financial world and started implementing a couple of odd habits. Most people love instant gratification, and electronic devices give them that. Individuals will look on their phones or their PCs to look at the balance of their checking account more often than they should, and this is where the problem happens.

A lot of people believe that looking at their current balance is the true depiction of what their savings account actually contains, so they may spend down to the last dime. Let’s say you believe that your account has $500, but when you look at it, it’s actually m$1024. Discovering this causes variations in the average person’s spending behavior even though there are likely several reasonable explanations as to how their balance is more than they suspected. More often than not, transactions have not been posted yet, or a check or a payment did not get cleared.

If someone were a chronic balance spender, they would probably find themselves spending more. Think about waking up in the middle of the night and feeling hunger, so you decide to walk inside of the kitchen to get a late night snack. When you rummage and search the pantry to get those tasty bite-sized brownies you love so much, you are sure the box is close to finished. However, you’re pleasantly surprised when you learn that there are more cookies in the box. You decide to treat yourself with more cookies. Whenever we are given a lot of a particular resource, we tend to use up that resource more than we intended.

It works the opposite way as well. Whenever we have to work with spare resources, we will end up using fewer resources than we would like. Whenever you don’t spend cash, you don’t think about how much money you have in the bank.

Any time you notice you don’y use up a certain amount of money that you normally spend, the best thing for you to do is immediately move the money from your checking’s account and straight into your savings account. Are your saving yourself a hundred or so buck each month because you don’t have to put as much money towards certain things anymore? Then you should start putting the money you would have spent on gas to your savings account every time you fill up your gas tanks. Did you make lunch and take it with you to your job? You should be moving the extra money to your savings account that you didn’t spend dining out.

It really is that simple.

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