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In economics, savings is the sum left after spending. But why is it so difficult to save money and so easy to spend it?
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When it comes to banking, savings means short-term deposits with a bank or another financial institution that carries interest. In our everyday lives, saving money can mean delaying immediate gratification and fulfillment of needs, for achieving future goals and plans.
Obviously, it is important to spend money on paying your bills, but a lot of the time people spend money because they have access to it and haven’t made proper plans for it.
“If you are unable to save, perhaps it’s time to look at the relationship you have with money,” says Eunice Sibiya, head of consumer education at FNB.
She says people with a good financial relationship realise that saving has very little to do with the size of your bank account; it all depends on your financial relationship.
Other reasons may include:
If you don’t know how to save R10 out of R200, how will you manage to save R100 from R2000? Many people who don’t save, always present the excuse of not having enough money. Though that may be true, it’s about exercising the muscle of saving. If you start saving R100 from your R8000 salary, you’re more likely to continue saving when you earn more, and sometimes even less.
This is a tough one for shopaholics and even your casual spenders. People’s needs differ. While one person may be able to reduce the amount of money they spend on hair and make-up, another may need it because they feel more confident and presentable. It’s a tough one, however, if you can’t cut back on beauty products, maybe try cutting down on take-outs and expensive trips or getaways.
Separate your monthly expenses according to what will be debited from your account: money for petrol, groceries, hair, entertainment, and include savings as an item. That way you can save a little bit of money immediately after you get paid. Make it a necessity.
Grab your bank statement, calculate how much you spent the previous month. That should shed some light on the areas where you’re consuming some of your money without noticing.
Saving can be challenging for many people. If you need accountability, perhaps it will be beneficial to join a savings club or a stokvel — one with transparency and honesty with people that you trust.
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