5 Tips For Mindful Saving
You can watch my full YouTube video on this topic here!
Saving money can be hard. There’s so much to spend on right here, right now! And frankly, everything costs a lot more than it used to thanks to inflation, which is cutting into many households’ ability to save. It can be extremely difficult to get into the habit of putting aside money towards our future self and his/her needs. That future version of ourselves—the older version—often feels like such a stranger to us. We know in our heads that someday we’ll hit retirement age and probably want to work less, but that can feel like another lifetime away…until one morning we wake up and we’re there.
The trick is to imagine yourself down the road, at retirement age, and think NOW about how you can best provide for that nice future version of yourself. Mindful saving is the ultimate form of self-care, because you’re not leaving your finances in retirement up to chance.
Here are 5 tips to get you started on your journey towards mindful saving:
1. Reflect on your values. Mindful saving starts with making it a priority, instead of just spending everything you’re making. Before spending on anything, and especially on major purchases you plan to fund with loans, ask yourself if the purchase really aligns with your core values and long-term savings goals. Is owning something really pricey today going to mean you’ll have a worse quality of life in retirement? Make sure to involve your spouse or partner in this exercise as well! Avoid purchases you’ll regret later by considering what truly brings you joy and fulfillment first. I have a full YouTube video on impulse shopping you can watch here. It’s easy to blow your budget with impulse purchases, which steal from your long-term savings goals.
2. Practice gratitude. Instead of focusing on all the things you don’t have (easy to do in our consumer-driven culture), appreciate what you do have! This can help reduce the desire for unnecessary purchases, and help you cherish what’s already in your life. If you don’t have much money in savings at the moment, practice gratitude for what you do have, and make a commitment to grow those savings steadily over time. You’re not alone if you don’t have much in savings: you can read more about this here and here. Inflation has been hitting people’s savings rates hard over the past few years.
3. Balance today’s and tomorrow’s needs. Create a budget that allocates money for your needs and some of your wants today, as well as for your needs tomorrow. Spending some money today on things that genuinely enhance your well-being and happiness will make setting aside money for savings more sustainable. Otherwise, budgeting can start to feel very limiting and restrictive. I have an entire playlist on YouTube about budgeting that you can watch here! Not to get all YOLO (You Only Live Once), but it is in fact the case. Figure out how much you need to save for retirement and emergencies, and then give yourself permission to spend some on your present self as well, especially on your health and well-being, and on experiences that create treasured memories with family and friends.
4. Make sure your savings are earning interest. Whether you choose to put your money in high-yield savings accounts, investments, CDs, real estate, or other interest-bearing options, try to make sure your money is making you money while it’s waiting for you to use it later. That way it won’t get gobbled up by inflation, making it worth less in 10, 15, or 20 years than it is today. Inflation is not the saver’s friend, so consider hiring an investment advisor if you want to learn more about growing your wealth.
5. Consider working with a retirement advisor. It can be daunting trying to answer the question “How much do I need to retire?” This is because everyone’s situation is different, and the lifestyle you want to live in retirement will be different from someone else’s. You can read more about what to look for in an advisor here. Planning and saving for retirement really isn’t something you want to DIY, as so much detail and planning goes into making sure you have enough to live on during your later years. It’s a multi-decade process, so the earlier you can start saving for retirment, the better! Interview several advisors before deciding on one to work with, and always check their online reviews and business ratings.