The Hummingbird Blog

A Series of Insights Into Savings, Personal Finance and Behavioural Science
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Part 3 - Why Is it So Hard to Save Money?

Saving money is not easy by any means. It requires a combination of discipline and clarity. First of all, discipline is needed in order to avoid spending money that you have. This isn’t easy, especially when you consider the number of ways it can evaporate. Thus, you need to be disciplined in the way you choose to go about your expenses. Secondly, you need clarity to save money. By “clarity,” we mean, understanding the purpose of saving money.

However, it is clear that is has become increasingly difficult for people to save money in the UK. A recent report indicates that 14.4m working-age adults in the UK have no savings at all. This is certainly an alarming fact when you consider the potential need for savings during difficult times. Moreover, it is estimated that 26.5m adults do not possess adequate asset balances in an emergency savings fund or in pension savings.

Now, you might be thinking, “yes, this is true because it’s so hard to save money with all of the bills I need to pay every month.” Of course, there is no denying that bills, in particular debt, have pinned a great deal of people down. This is why finding a way to increase savings is crucial. At this point, saving money might seem like a dream, but you will be surprised to find that it’s not nearly as difficult as you might believe.

This is why the first step to saving money lies in understanding the purpose of it. Once you have a clear understanding as to the purpose of saving money, doing so becomes far easier.

How so?

Saving money becomes easier at this point because it removes the most complicated barrier of all: believing that it is possible. You see, many people believe that saving money is about putting hundreds of pounds into their saving account every month. The fact is that this is not necessary. Starting out with any amount at all is a great way to get started.

The point here is to get started regardless of the amount.

So long as you are able to get started saving money, you will be able to begin building your retirement fund. Even if you aren’t planning to retire for another 30 years, just knowing that you have this plan in place is a great way of helping you sleep better at night. Ultimately, it’s a question of peace of mind more than the actual account balance you possess.

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