We all know saving money is important: ‘pay yourself first,’ the experts say. So why are Canadians saving less and less each year? Many blame the high cost of living and debt levels, but Rice University marketing professor, Utpal Dholakia, has an interesting theory – just like some people are better sticking to a healthy diet and exercise routine, some people are better at making saving a part of their lifestyle, regardless of how much money they make.*
A habit is a routine behaviour that is often done without much thought, like brushing your teeth. Here are some ‘habits’ that, when practiced daily, can help make saving part of your lifestyle.
Track your spending. Picking up a new saving habit could mean getting rid of old spending habits. Track your spending for a week or two, and see where your money goes! You might be surprised. Motivate yourself to make small adjustments – some people might like the challenge of seeing how long they can go without spending any money! Others prefer to withdraw a set amount of cash each month to limit their spending.
Make coffee at home instead of buying from a coffee shop each morning. If you have a timer, set it and wake up to the smell of fresh brewed. Or, buy a special flavour to make that first cup special.
Plan out your meals for the week, including bagged lunches. Restaurant meals and fast food can become a major household expense. When you cook, make a little extra – leftovers make an easy lunch. Do something different – put your lunch bag next to the coffee maker – as reminder. Taking the time to shop for and cook meals will save you money in the long run.
If you are goal oriented, set a weekly budget for your household spending. Once a month, review your accounts – groceries, clothes, transportation – and track your progress. Then,
Write down your short and long-term goals, including the amount of savings you’ll need to reach them and the timeline to reach your goal. For example, if you are saving for a family vacation at a theme park two years from now, research the cost of the flight, hotels, meals and theme park tickets, then calculate how much you’ll need to set aside each week for the next 24 months to reach your goal. Tracking and monitoring your progress can help you reach your goal.
Wait 48 hours before you make a big purchase –– and do comparison shop for larger items, such as a major appliance, new roof, furniture or electronics.
There are many ways to incorporate saving habits into your lifestyle. Think about what will motivate you and choose one or two different strategies to spend less. With practice and patience, not only will saving give you more in the end, you can enjoy the peace of mind of being that comes with being in control of your financial situation or, what Dholakia calls, “money happiness".
*”Is Saving Money Part of Your Lifestyle? New research finds having a personal saving orientation has many benefits,” Utpal Dholakia. Psychology Today (posted Jan. 19, 2016).