There are a lot of myths about saving money that may be keeping you from putting money away. With all this misinformation flying around, too many people believe these common myths. Don’t let all of these myths and false information keep you from achieving your financial goals!
We have debunked seven of the most common myths about saving money. This should dispel any hesitation you might have about saving your money, opening a savings account, and starting down the road to financial freedom.
Myth #1: It takes a long time to save money.
Sure, saving for a new house can take months or years. However, there are probably a lot of other things you don’t buy on a regular basis because they seem too “frivolous.” How long would it take for you to save up for a massage, a meal in a nice restaurant, or a nice pair of shoes? Saving money can take weeks or mere days, depending on the price tag and the time you’re willing to invest.
Myth #2: Saving money makes sense if you have something specific to buy.
Can you predict when a co-worker will offer you half-price tickets to a Caribbean cruise, your new romantic interest will ask you to sign up for skydiving lessons together, or your favorite band will play a pricey benefit concert? How about predicting when your car will break down and you need to lease a new car, your aging parent will need a hospital visit, or your water pipes will burst? Saving money lets you take advantage of once-in-a-lifetime opportunities and take sudden hurdles in stride.
Myth #3: Saving money is impossible if your family is not on board.
Is there anything more infuriating than learning that your spouse just blew through your joint savings account? How about when your kids plead to go out for pizza after you’ve explained that you can’t afford it until the credit card is paid off? Granted, it’s easier to save when your whole family is on board. However, if they’re not, then set up a private savings account, and deposit your monthly savings before you contribute to household bills.
Myth #4: Saving means you can only spend money on the basics.
Do you remember the food pyramid in health class, with the boring nutritious food groups at the base and the yummy no-no foods at the apex? News flash: there’s no universal spending pyramid. Most people’s spending goes towards basics like food, rent, and transportation, but that’s an average, not a rule. If you want to rent a cheap room in a run-down neighborhood so you can afford designer clothing, go for it. Saving money means honoring your own priorities.
Myth #5: In order to save money, you have to learn about IRAs, 401Ks, and CDs.
Do you need to learn how to use an elliptical training machine before you can go for a jog around the block? Do you need to get a degree in graphic design before printing out garage sale flyers? Of course not.
Likewise, you don’t need to have an elaborate financial plan or spend hours researching complicated investing strategies. Saving money can be as simple as emptying your change purse into a Mason jar every evening. Even better, you can take simple steps to automate your savings.
Myth #6: You can only save money if you are organized.
If you think you have to track your purchase, divide your cash flow into categories and create animated color-coded charts before you can save money, think again.
Plenty of online tools will do the organization for you, like Mint.com or your own bank or credit union’s automated bill pay program. You can also turn disorganization into a benefit: hide $5 bills in your pockets before you throw your dirty jeans on the floor. Laundry time will reveal a forgotten savings stash.
Myth #7: Saving money means lowering your standard of living.
If you punish yourself by lowering your standard of living every time you want to save money, you’ll hardly feel motivated to save. Instead, try to get creative. Brainstorm ways to make more money on the side, preferably by setting up passive streams of income.
Try affiliate marketing, eBay trading, or freelance writing. Saving money means finding smart ways to maintain your standard of living while putting money aside at the same time.
Now that you know about a few of the common myths regarding saving money, it’s time to take action. You can save money starting today, and you can do it in any way that makes sense for you and your lifestyle. For more tips, check out this article on how savings accounts work.