9 Tips for Making Saving Money a Habit

Look anywhere and you’ll see dozens of books, articles and blogs written on the topic.
And for good reason… people not only want to save, they need to save.
But what do you do if you never seem to have any money to put away? Or maybe the amount you put away is so small you’re doubtful it will ever grow into a reasonable sum of money.

The best way to ensure that you’ll have what you need is to be intentional with your savings.
Here’s how to do it:

1.    Pay yourself first
You’ve worked hard for your money. You deserve to keep as much of it as possible.
Before paying any of your debts, set aside a portion of your income for yourself.
Set up an emergency fund first, followed by money set aside for investments.
Make it foolproof and set up automated transfers to interest bearing accounts before you even see the money.

2.    Know where you want to go – what’s the money for?
Without a plan you’re faced with a nebulous idea that you “need to save money”.
While some may find the “save money” mantra to work well for them, others might find the ambiguity of such a statement less than motivating.
In other words, you should know why you’re saving money and what you’re going to do with the money you save.
For example, your emergency fund is important to have, but you probably don’t need ten years’ worth of income in that account.
Most experts recommend you have anywhere from three to six months of living expenses set aside to prepare for unforeseen events such as being made redundant at your job.

3.    Set up your own personal rules
Make up your own personal money rules.
Learning any new habit can be hard, but when you’re talking about issues surrounding money, it can be even harder because we’re often called upon to make many decisions surrounding it every day.
What if you were able to set up rules surrounding how you deal with money to make your decisions almost automatic?
Using a strategy known as a “heuristic technique”, you can set up your own internal rules for dealing with money.
Examples of a “heuristic” would be “I don’t spend more than $75 dollars on a pair of shoes” or “I only buy used cars for cash.”
Create a rule of thumb for every part of your financial life and it will get easier to meet your goals.

4.    Get out of debt
You might wonder how getting out of debt can help you create a money saving habit.
It won’t, in and of itself.
It will, however, make saving money easier and that’s the point, isn’t it?
Make saving money easier so it can become a habit.
Life is just easier without bad debt, so eliminate it and free yourself up to easily create good money saving habits.

5.    Do I really need this?
Get into the habit of asking yourself “do I really need this?
Chances are, you don’t.
This is a powerful way to make saving money a habit because you’re making a conscious decision to spend.
Combine this tactic with your personal money spending rules to reinforce your saving habits.

6.    Analyse your habits
Drop by the coffee shop every morning? You obviously don’t do it because you hate coffee!
Many of our habits form around the things we love to do.
Think of your own spending habits. Keep only those habits which you consider worth the expense and discard the rest.

7.    Add to your existing routines
Think about your existing routines and find logical places to add your new habit(s).
Pay your bills every Friday?
Then make it a habit to review your budget at the same time.
The sooner you know if you’re falling behind your savings goals the sooner you can make adjustments.

8.    Give yourself reminders
Doing things on autopilot saves us a lot of time, but if we’ve gotten into bad money habits it can hinder our progress.
Set up reminders (e.g. a sticky note on your credit and/or debit card) of your goals to make forming your new habits easier.

9.    Moral support
Find an accountability partner who can help you stay on track.