Why Is It So Hard To Save Money?

save money & financial budgets

Saving money comes down to 2 things.

#1 Having a goal

# 2 Consistently following a plan to achieve this goal

It seems so simple…

Why then, is it so difficult for people to start saving money for short term or long-term goals?

Well, believe it or not. We are our own worst enemy when it comes to saving money.

It’s about implementing small changes in your daily life that focus on this one goal.

Saving is like dieting.

saving money

If you want chiselled abs or a tight bum, you can’t just stick to a nutrition plan for 4 days. Then eat & drink everything in sight for the next 3 days of the week.

All that hard work gets undone and you’re back where you started.

This is the dreaded cycle for many.

Hamsters on a wheel not able to get ahead and wondering what they are doing wrong.

I’m going to tell you now. Consistency is king when it comes to saving money and sticking to your financial budget.

What I’m going to do is give you the tools necessary to implement your financial budget. Also, show you how you can change your mindset to focus on your savings plan.

45 days is all it takes to implement a saving money mindset which you can stick to.

You may want to save money for any number of reasons. Holiday, new car, investment, pay home loan off faster etc

Whatever the reason is, it works the same for each.

Pay off bad debt

Now, before you start putting together a savings plan.

You first need to determine your current position as it stands today.

I want you to write a list of

Good & Bad Debts:

The reason this is important is that bad debt quite often have high-interest rates and repayments. Bad debts tend to suck the financial life from you.

If you want a more detailed explanation of good & bad debts you can read our article

Good & Bad Debt: Debt Recycling Guide. This will give you a great breakdown on how to identify each debt and which category it fits into.

Now that you have written out both your good and bad debts.

It might look something like this:

good debt & bad debt

It doesn’t matter if you don’t have any good debts.

What matters is what you want to put in place moving forward.


We strongly recommend that once you have implemented the savings plan & financial budget. You use the extra savings to pay down your bad debt balances.

This will put you into a much better financial situation faster.

Because bad debt has high interest, your priority should be paying this off as fast as possible.

Set financial goals before you start

A lot of people groan when I talk about setting goals.

If you’re not going to set goals then you really are putting yourself at a disadvantage from the start.

It’s like running 120 metres to win the 100m sprint. Insanely hard to do.

In fact, you’re 42% more likely to achieve your goals if you write them down.

Why do you think all those bodybuilders, high-level sports athletes plan out every meal they eat and every session they train?

It is like their road map.

Financial Goals are the whole reason you want to save right? So it doesn’t make sense to skip it.

You can refer to the goal setting example in one of our other articles. Alternatively, enter your email below by clicking the button and we will email it to you.

3 Reasons to set savings goals

money saving target
Keeps You Focused
reduce stress
Reduces Stress
accountability to save money

I personally have 3 main reasons I firmly believe writing down your goals & implementing a budget are 100% necessary.

# 1 Keeps you insanely focused

You only have so much energy, so by focusing that energy you keep your eye on the prize.

Everything you do is razer sharp towards your goals and what you want to achieve financially.

It helps you deal with procrastination issues and allows you to set aside tasks and expenses that are not aligned with your goals.

It helps with distractions that try and pull you off course.

# 2 Reduces stress

I don’t know about you, but having fewer things that you need to make decisions on reduces my stress.

Also, the emotional guilt when you buy something that you didn’t need (buyers remorse), isn’t there if you follow your plan.

The reason we fall off of our plan is due to emotional stressors that trigger old habits. By having a set focus and plan it helps to mellow out these peaks of emotions and gives you power back to manage your emotional state.

You will find that after 4-6 weeks of following your plan & you start to see your savings goals being met. Stress will decrease more and more as you gain control over your financial affairs. You will start to find saving money as fun.

According to CNBC, 44% of couples said that money issues were the primary cause of relationship issues.

Don’t make it one of yours.

# 3 Holds you accountable

Ok, this one is my favourite.

I’m big on accountability & tracking your progress. Or, should I say YOUR SUCCESS!

Yes, you will fail from time to time.

Yes, it’s ok!

We aren’t perfect so it’s inevitable that we hit some bumps in the road along the way.

What is important is to continually track your progress, but it’s just as important to track your failures too.

Find out why you failed at that point. Learn from it so that you can stop it from occurring too often in the future.

Tracking your progress allows you to find what works for you & perhaps what doesn’t. If something isn’t working for you, change it.

One of the best things to track your progress and hold yourself accountable is with a financial budget – we will talk about this in detail shortly.

Top 6 Reasons Why People Fail To Save Money

Now there’s a lot of reasons why people fail to save money. However, we have put together a list of the top 6 reasons we believe stop people from being able to put in place a savings plan and financial budget.

Top 6 reasons people can't save money
Top 6 reasons people can’t save money

#1 Keeping Up With The Joneses

It focuses on our fear to not “look” successful in the eyes of our family/friends & neighbours.

Also, why do we care about what someone we don’t even know thinks of us?

I knew a couple who sold their business for a few million $. They retired at a young age of 47.

They owned a nice house, nothing too crazy. But drove in quite cheap cars.

financial saving plan

People used to judge them thinking they were not successful just because of the cars they drove.

Now I do not know what you consider successful but being self-funded in retirement at 47 is pretty darn successful to me!

So, without offending you. Drop the ego, learn to accept that 95% of people with nice things and cars use most of their incomes to “afford” these things.

Many even rely on credit cards and bad debt.

The first thing killing your savings plan is this notion of “having” to look good because you want to impress others. This is called the pseudo-affluent look.

#2 You Put It Off Till Later

What’s the most valuable commodity that you can guarantee you will run out of?

Yes, Time.

Why is it then, that we put things off?

save money

The biggest excuse to save is that I don’t earn enough money.

I’ll start saving money once I get a promotion. Or, I earn more.

You cannot control what things may happen in the future. Also, if you have bad saving habits now I guarantee that you won’t be saving money in the future.

This is why peoples living expenses go up when their incomes go up.

They feel they now “deserve” to spend a little on themselves because they worked hard to get to this position.

That’s great, but isn’t the reason you didn’t save before is that you waited to get to this point?

Hmmm… See it’s a cycle. Break the cycle and start saving today. Instil good habits now and break bad ones.

That is unless of course, you like government assistance?

#3 Living In The Now Is Cool

saving plan

Ok, some might take offence with this one. But, it is a legitimate reason why people can’t save money.

They use the excuse they are “living in the now”. Like this somehow justifies poor financial choices.

This doesn’t need a whole lot of explanation.

If you spend all your money “living in the now” & you don’t have anything left over. You can’t possibly save money and you can’t set yourself up financial in the future.

If you’re one of these people, I suggest you do a goal planning session and try and find something that excites you financially that you want to achieve in the future.

Owning a home, having a 2nd income source can be powerful reasons to start to change your habits.

#4 You Are Too Nice

This one is a double-edged sword.

There is nothing wrong with being nice, we encourage it. However, what we are talking about is being too nice with your money.

Letting others mooch off you. Remember, their lack of bank balance is not an excuse for them to affect yours.

Not only does it impact you financially, however it can also emotionally upset you. No-one likes being used.

Remember, it’s not your job to support someone else’s financial problems. Learn to say “NO”.

#5 You Confuse Wants With Needs

needs vs wants
Needs Vs Wants

Now when we talk about needs vs wants.

We are talking about the things we “need” to survive in life. Anything, that isn’t a need, is a want.

You will be amazed at just how many costs in your life are wants not needs.

We tend to rationalise these things in our heads to make ourselves feel better about the purchase.

But the hard truth is we are wasteful. I haven’t ever met someone who hasn’t been wasteful. We are all guilty.

However, we can make small changes to help break bad habits.

So to start, what you need to do is write a list of what you classify your needs and wants as.

A good exercise is to take the last 90 days and write down everything you bought and which column it falls into. Now, I’m sure you are as surprised as I was when I did this myself.

You can refer to the example above if you’re not sure of which items belong in which column.

#6 You Have No Financial Budget Or Savings Plan

Ok, so you decided that you wanted to save money. But you haven’t put in place any goals/plans or personal finance budgets in place. Oh No!

This is like dieting without a nutrition plan & having no groceries.

Not going to happen.

no budget no plan
You need a financial plan to succeed

If you haven’t completed your financial goals – scroll back to the “set financial goals” section of this article and enter your email and we will email it to you.

Now if you still aren’t convinced that a plan is important. Did you know that the average timeframe it takes to save a 20% deposit for a first home buyer couple is 4.6 years?

Now, we know property prices are growing. You can either whinge about it, or put a plan together and achieve it.

first home buyer deposit
Average time to save a 20% house deposit for first home buyer

Now if rather than saving for a deposit for a house you wanted to invest the money into the share market.

How much could you potentially have for retirement after 30 yrs?

Well, of course, that depends on how much and how frequently you can put towards the strategy.

If as a couple you were able to save $50 each a week. That’s $433 a month.

After 30 years you would have nearly $1Million. What’s amazing is that you would have only had to invest 15% of that amount. So $155k invested over 30 years creates $1mil in capital for retirement.

investment calculator

Financial Budget

The next step now that you understand the reasons on what stops you from saving money, is to do up a financial budget for yourself.

This consists of completing where you are currently now after income & all expenses. Then narrowing down on your expenses and eliminating what’s not needed.

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Andrew Mitchell