If Saving Feels Impossible, You Might Be Starting in the Wrong Place
For many people, even saving a little bit of money can feel like a constant uphill battle. It doesn’t help that the costs of living keep increasing, but wages aren’t staying competitive. Add in high-interest debt or emergency costs and many people are just hoping to catch a break.
According to financial experts, if saving feels impossible, you might be starting in the wrong place.
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The Biggest Mistake: Starting With the Wrong Goal
Many people jump straight into saving or investing without focusing on a goal, or by getting distracted from that original goal, according to Jeff Stouffer, a certified financial planner and chartered alternative investment analyst at JustAnswer.
"They had an immediate need for cash [that] was solved by taking funds out of the savings program that was designed to meet a stated goal."
David Kindness, a certified public accountant and personal finance writer at BestMoney, added that another mistake is “trying to save too much too fast. Then they feel tired and stop. Another mistake is skipping the basics.”
Cognitive Load Overwhelm
For many people, saving money is a process of negotiating competing priorities, which adds up to what Matt Tomko, chief revenue officer at Happy Money, called “cognitive load.”
“When people are carrying high-interest debt and watching balances tick up every month, the brain prioritizes the immediate threat over the long-term goal,” he said.
Debt is an all-too-common theme for Americans, who are holding a record $1.3 trillion in credit card balances with APRs topping 20%, Tomko said.
“The tension between paying down debt, building savings and investing has never felt sharper.”
Once financial stress sets in, lack of goals and negative beliefs “contribute to an inability to start and maintain a savings program,” Stouffer said.
Where To Start Instead: A Smarter Order of Operations
Tomko suggested that people start by building a small emergency cushion so an unexpected expense doesn't push them back into new debt. From there, tackle high-interest debt.
“Once that high-rate debt is under control, even modest, consistent contributions to investing start to build real momentum,” he said.
Stouffer likes to break savings into “timelines.” He explained that current debts should be prioritized immediately, emergency savings should come after debts are paid, and investing is for the long term. The key is finding the right mix.
Small Wins Beat Big Plans Every Time
When people feel stuck, the answer is rarely doing more. “Even saving $50 or $100 is a good step,” Kindness said. He shared how just helping a client isolate an additional $75 in wasted expenditures helped them feel “more confident and in control.”
Automating savings is the most surefire way to do it, as well, Stouffer said. And committing to a level “that does not cause stress” is likely to reinforce the behavior.
Tomko said those who struggle to save need to “reduce the source of the overwhelm first. Lower the noise and consistency follows.”
The Mindset Shift That Changes Everything
Progress is more likely to come from simplifying your savings approach than trying to do too much. Tomko chalked it up to a mindset shift “about changing the structure of the debt itself.”
That means following a plan and creating a solid budget versus juggling balances.
“Saving for the future is not about being perfect, it is about making a series of small changes,” Kindness said.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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