When it comes to saving, how many of us can raise our hands and say that we’re truly on track? Yep…that’s what we thought. There’s a whole range of reasons why our financial goals might feel unattainable. One of the most common excuses (yes, we said excuses!) is that our monthly expenses like rent, groceries and bills far outweigh our income. But is this really the case?
Studies show that those who struggle to save are often dealing with more of a cognitive problem, than a financial one. One of the biggest mental blocks when it comes to saving is the way that we perceive time. Researchers have divided the way that we think about time into two states: cyclical and linear. Those who think in ‘linear time’ see their life made up of a past, present and future. If we view life as made up of 3 completely separate stages, we presume that success or higher earning will come later on – giving us the perfect excuse to put off saving money!
Does this sound like you? Then it’s time to start developing a cyclical mentality. People with this mindset view life as a series of similar cycles. Instead of imagining their future as something far removed from their current life, they try to picture it as something similar to what they have now. These types of people are far more likely to start saving in the present, and more importantly, to keep on saving cycle after cycle. Avoiding saving money now because you’re relying on future success is a recipe for disaster, because life just isn’t that straightforward.
Just to set the record straight, this doesn’t mean that you can’t be optimistic about your future! Quite the opposite. In fact, another fantastic, science-backed tip to fuel your savings is to start envisioning your future right now. Research shows that uncertainty about an end goal can lead us to put off working towards that goal altogether. An example is when you’re waiting in a queue that doesn’t seem to be moving. Even if you really want to get to your destination, not knowing when the traffic will start moving again might cause you to give up altogether.
Our brain’s approach to saving money works the same way. If you can’t picture exactly where you want to be in a few years time, it can feel like there’s no real motivation to prepare for that future. Especially when you’re saving for a deposit! It can be discouraging to feel like endless months are passing, and yet you have no set time for when you’ll finally meet your goal. This is why you should always try and make goals as concrete as possible. Work out the specifics and set a time frame for yourself.
Our free Homefinder tool is an incredible way to do this. Once you input your future home goals, the online app will calculate an exact end date for when you expect to be able to buy! If you stick to our recommended monthly saving amounts of course…
So remember. Your future shouldn’t feel like a distant, foggy dream. This year, work on envisioning exactly what you want to achieve, and developing a set time frame for when you’re going to achieve it. Forget new year, new me….it’s time for new year, new mindset!