Mortgage! Your child’s college tuition! Retirement is closer than you think!
The future sounds like a scary and expensive place. So scary in fact, that according to TransAmerica, each subsequent generation has begun saving for retirement a little bit sooner. Baby boomers began thinking about saving at 35, Generation X at 27 and Millennials at a median age of 22! There can be no argument against fiscal responsibility, but like everything it should be done in moderation.
If you’re in your twenties or early thirties and saving has become a lifestyle you may be over-doing it. Here are four signs you might be savings obsessed and some suggestions on what to do about it!
(1) You’ve cut out spending on things you love.
Assuming your pleasure isn’t caviar and Dom Perignon I can guarantee there are better items to cut from your spending habits than the things you love. Get your fancy latte at Starbucks, your sushi for lunch or your favorite snacks – just remember moderation is the key.
Pick a day to treat yourself and stick to it! We’re creatures of habit and we happily get stuck in a routine. If you make your routine waiting until Thursday for your Orange Mocha Frappuccino you’ll be happy getting your treat and we promise the three extra dollars won’t break your bank.
(2) You can’t afford to go out with friends.
I’ve heard the argument – I just can’t afford to go out I need to be saving money! It’s true going out to the bar or to dinner with friends can sometimes add-up, but missing out on life’s experiences shouldn’t be your solution. How many of your favorite memories begin with “I was saving money on a Saturday night” versus “Remember the time when we…”? Memories are made by doing so be sure your focus on savings isn’t stopping you from making them!
If you really can’t afford to go out on the weekends, or mix in a dinner with friends once every week or two try suggesting a cheap activity for a weekend. Go on a hike, a picnic or a group trip to a lake house. Another option is to take advantage of daily deals sites – there’s always great local businesses giving away fun at an affordable price and you’re friends will thank you for saving them a buck, too.
(3) You don’t ever splurge on yourself.
Your retirement is 30 years away and those boots you’ve been staring at in the store window will probably be long gone by then. You’ve got to treat yourself to something every once in a while. The world is a tough place, and sometimes the only way to combat the rigors of daily life is with some retail therapy.
But let’s be smart – you’re retail therapy when done on impulse can leave a gaping hole in your account. Take a couple dollars a day and throw them in a jar. Check that jar in a couple months and BAM – go get those boots! You won’t feel like you’re splurging and you’ll be proud you didn’t buy on impulse. A self-esteem boost and some new boots? Sounds like a pretty sweet deal.
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(4) The topic stresses you out.
Have you ever heard the saying “fortune favors the prepared?” If the topic of saving stresses you out there’s a simple cure: have a plan. Taking a deep breath and addressing your financial concerns head on can have a massive effect on minimizing your stress levels. It’s like when you used to check for a monster under your bed as a kid – guess what, the monster wasn’t there and your financial situation isn’t that bad.
But budgeting can be tricky and unless you’re a financial whiz you’ll want to get some help. We live in an incredible digital age filled with Silicon Valley entrepreneurs scrambling to put an easy solution for all life’s troubles right at your finger-tips. Take advantage! You already use Uber for a lift (sorry Lyft), Yelp to make sure you don’t accidentally order moldy Indian food and Google Maps to help you get, well, anywhere, so why not get some help managing your finances?
Mint.com and Level Money are two of many free apps that help you budget, save and manage what you spend. They even offer advice on how to improve your financial situation and in some cases connect you with discounts or other promotional offers. It’s like having your own personal financial assistant! Budgeting apps help you take control of your finances and help you realize you do have room to save for your future and live your life.
For the sake of your sanity and your quality of life, don’t over-save at the expense of living. It’s true that the future is filled with big-ticket purchases, but with a strategy, some financial planning and a little bit of help from your favorite app, you’ll find you have plenty of cash in the bank to save for your future and spend on yourself today.