We know we should save but many of us fail to diligently fill our savings accounts and build our investments. Are the reasons the same as when we want to lose a few kilograms but don’t have the willpower to resist one more chocolate? Is it all about willpower, laziness or not having the time to structure a plan? While a small part of it can be attributed to human nature, there are other factors that inhibit our tendency to save. These are very real issues and burying your head in the sand is not going to improve any of the below scenarios:

High living expenses in relation to income

If your income is very low, it’s hard to save when all of your salary is spent on essentials like food, clothes, travelling costs and electricity. If you have a reasonable income but have committed yourself to an expensive lifestyle (such as the area you bought your home in, the car you drive or the school your children attend), then you could be living well now at the expense of your future. It’s hard to get out of the self-imposed trap of working to pay for your obligations. Not everyone’s obligations are self induced though. If, for example, you have elderly parents to take care of or if you have just divorced, your capacity to save will be compromised until your situation changes.

There are a number of things you can do to counter your high living expenses. The first one would be to downscale your expenses, if you can. You could also try to earn more by finding a better paying job or studying to improve your earnings ability in your current job. Chat to your boss about the possibility of a promotion with an increase. If that’s not an option, find extra work or a weekend job. Perhaps you could sell something (a product or service) from home during your spare time. Ultimately, you need to choose between spending less and earning more. Which one resonates with you?

Getting into too much debt

Many people spend their entire salary on repaying debt.  If you have large accounts and credit cards that need servicing, it can be hard to find extra cash to put into a savings plan.

Relieving the pressure of debt starts with actually making a commitment to reduce your debt levels. Pay a little extra where possible. If you need to earn more in order to do this, then follow my suggestions in the previous scenario. Sometimes you have to put your pride in your pocket and return or sell the item that you bought on credit - take the loss and move on with something cheaper. Downsize your life temporarily until your debts are no longer a disaster and learn from this mistake - do not overextend yourself ever again.

Spending habits

What are you spending your money on? Do you tend to spoil your children? Do you shop ‘til you drop even when you have no spare cash during that month? Do you use any cash surplus to buy new items for the home, accessories for your car or do you have an expensive hobby?

To change or improve your spending habits, you need to focus on what you spend too much money on and then make a concerted effort to reduce your spending. Sometimes just writing down everything you buy in a month will alert you to how much you are wasting. If you do have a surplus and you know more or less what it is every month, then start a debit order to a savings account that deducts the amount you want to save every month the day after payday. This is called ‘paying yourself first’.

Attitude towards saving

Have you started a savings plan previously and been disappointed with the returns? Some people are afraid of wasting their time with a savings scheme that probably won’t generate the returns they expect. Others have the attitude that they will start saving next month, when they get an increase or when their Woolies account is settled but something else invariably comes up.

If you were unsuccessful in a previous attempt to save, don’t stop trying! Educate yourself on the various savings and investment products that are available so that you won’t make the same mistake again. Success, in all walks of life, will only come through practice. Look for a product or process that you understand and feel comfortable with. Just imagine how it will feel if you do get it right this time. Your life will change forever. And don’t postpone your saving plan until next month or next year, when things are looking up. Your circumstances will only improve when you make a concerted effort to improve them.

It’s not always easy to start a savings plan. At the moment, it may seem better to rather pay off your debt or spend the little that you have left on something nice. So in order to have more of a balance in your savings plan, you could divide your monthly surplus by three. Use 1/3rd to accelerate your debt repayment, another 1/3rd to increase your savings and the final 1/3rd to treat yourself or your family. Whatever you decide to do, the bottom line is that you should make saving a regular part of your budget today and remember that your savings and investments ultimately allow you to achieve your goals. These goals differ from person to person and could include things such as overseas holidays, purchasing a home, sending your children to university or enjoying a comfortable retirement. So while saving might seem quite painful now, in time you’ll find that it is an extremely rewarding exercise.