Art to save money: 5 most common mistakes

If you have already started to save money, congratulations - this is a reasonable step to a secure future. Ideally your money "safety cushion" should be enough for six months of life without financial revenues. But even if every month you make a profit and increase their savings, it does not mean that your strategy is ideal.

David Blaylock, a financial planner, has analyzed the common strategy for the accumulation of funds and gave some suggestions for their improvement.

Strategy № 1. Save what remains

So, you pay your monthly bills, maybe spend a bit of entertainment, then all that remains is sent to a bank account. Knowing that you have, in principle, have the money, you can spend more than they should, and then spend the funds earmarked for accumulation. In addition, it is difficult to set yourself a specific goal to accumulate, because you can never tell for sure how many will remain after all costs. Instead, you can try another way.

So how should it be?

The first bill, which must be paid after wages - this is your savings account.

Make it your rule and are perceived as obligatory and the most important part of the payment (of course if you have enough money to pay all the other bills).

Create automatic transfer of money from his bank card to the savings account at the beginning of the month or every cash receipt. If you just put this automatic transfer of money and forget about it, after some time, the amount of accumulated funds greatly surprise you.

Strategy № 2. I am transferring the money to the savings account

So you regularly save money - it is wonderful. Yes, and a savings account with plastic cards - it is very convenient. But there are some downsides.

If you run out of money, you risk withdraw their savings or even to spend their windfall, but very coveted purchase. And, most likely, you do, because to withdraw money is very easy: they are always within reach, you do not even have to go to the bank, it is sufficient to use an ATM.

So how should it be?

Open deposit in the bank for 6 months or a year. So you will not spend money for storage. Just do not invest all. For a number of leave on a regular saving account for emergencies.

Strategy № 3. All my savings are in the same bank

When you only have one savings account, it seems that money is piling up on it quickly and they will suffice for all. If you save up to only one thing, such as an apartment or holiday, it is all right. But if you have several goals, one bank account is difficult to process, and you do not see concrete progress. It is difficult to understand what is enough money, and what will have to wait.

In the end, it turns out that by spending savings, for example, on vacation, you do not leave anything on the new machine.

So how should it be?

It is better to have multiple accounts, each of which will be dedicated to a specific purpose, such as "home", "vacation", "on the formation of the child." So it will be much easier to calculate your finances and see real progress.

Strategy № 4. I just save large amounts when I can

Some people do not set aside money on a regular basis, and keep large sums immediately when good fortune falls. With this method of accumulation alternate feelings of abundance and guilt. Last - when you have to take money out of their savings. The disappointment of this may even discourage ever again to save money.

So how should it be?

It is best to set yourself a goal to accumulate and to strive for it. Identify a specific amount of money that should be set aside each month. If you think that it can be increased without compromising the quality of life, do it. But! Contributions should be consistent and similar.

Strategy № 5. I put everything I can

Despite the need to have savings, do not get too hung up on it and indulge in pleasures. They help us to be happy and to maintain mental health.

So how should it be?

If you have not had a month in which you could make money in the "emergency fund" set aside all other payments and pleasure, until you can do it.

When your six "emergency fund" will be replenished, Blaylock recommends to change strategy. As small cash savings bring a little money, you should consider the longer-term investments a good percentage.