Barriers to Saving and How You Can Overcome It
You know that having an emergency fund and savings is very helpful. You are fully aware that emergency funds and savings are what separate people who are financially afloat from people who are drowning in debts. But despite knowing all of these, you find it hard to save because you face barriers to saving on a daily basis.
This post will list down what the common barriers to saving are and offer you strategies on how you can overcome such barriers.
- Having no budget. Without a budget, it is very easy to lose track of your finances. It is your finances that dictate the way you live rather than vice versa. Prevent this from keeping you from savings by setting aside enough time to create a budget. A budget will allow you to allocate funds to each of your expenses. Apart from allocating funds for expenses, by sticking to a budget, you will be able to allocate some funds for savings and emergencies too.
- Making impulse purchases. Advertising lures us to buy things we don’t need especially when our emotions are at peak. This causes us to do impulsive shopping. Overcome this barrier to saving by examining what kind of emotions lead you to make impulse purchases. Once you have identified the root cause, plan on strategies that can help you cope with such emotion other than impulse shopping (e.g. eating, watching TV, talking to a friend, listening to music, etc.)
- Having one credit card debt after another. If you carry too many credit card balances, you are hindering your potential to be able to build an emergency fund. Having credit card debts keeps you from making smart financial decisions like saving money and investing. Overcome this barrier by implementing a debt snowball method where you pay off one debt to the next until you are completely debt free.
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