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5 reasons why we give up our financial goals
5 reasons why we give up our financial goals

Many live paycheck to paycheck, and only a minority manage to save enough money to safely retire. Well-known blogger Trent Hamm told why this happens and how to learn how to manage personal finances.

5 reasons why we give up our financial goals
5 reasons why we give up our financial goals

1. Spending money is pleasant, but saving is not

Buying something new is very pleasant, especially if you have wanted this thing for a long time. The problem is that this feeling quickly disappears, and you are left with another unnecessary thing. Of course, at the time of purchase, we rarely think about it, thinking only of a short pleasure, although it hurts our long-term goals.

Spend your free time on free or low-cost treats

Instead of wasting money on short-term pleasures, spend time on things that really make you happy. And give up unnecessary things, such as watching not particularly interesting TV series or aimless Internet surfing.

Consider your spending

Think back to your last purchases and admit that the pleasure of making them did not last long. And then imagine that this money could now be in your account and would become the next step towards your big financial goal. Remind yourself of this often, such as every time you shower or drive to work.

Change your social circle

Friends shouldn't have a price tag attached. If you find yourself spending a lot of money influenced by your social circle, try to change something.

Agree to refrain from additional expenses, and have dinner together at home, not in a restaurant. If you go somewhere with the whole company, spend money only on what you are interested in, and refuse the rest. The bottom line is that socializing with friends shouldn't be too expensive.

2. Financial goals are always long-term

We are by nature quite impatient, and when it takes years or decades to achieve a goal, it’s very easy to forget why that goal is important to us at all. It seems to us that it does not affect our daily life in any way, that we will achieve it “someday”. And so we stop striving for it.

Focus on micro-goals for one day, week, or month

For example, set a goal for this month not to spend money on your hobby at all, or by the end of the month to increase your savings to a certain amount, or start a new healthy habit that will help you save.

Think about what you have achieved so far, not how much remains to be done

Remember where you were a year ago. And six months ago? Even just a month ago? Has your income grown during this time? Has the amount of debt reduced? When you see that there is indeed progress, it will be easier for you to move towards your big goal.

Develop healthy habits to help you save

It will be more effective not to set yourself a goal, limited by a rigid framework, but day after day to repeat some useful action associated with your goal until it becomes a habit.

For example, if you often eat in a cafe and decide to save on these expenses, you need to cook more and take food with you every day. There are many actions in life that are worth accustoming yourself to. So you can change your sleep pattern, nutrition, approach to spending.

3. Financial goals do not require active action

Often we energetically get down to business, but then the enthusiasm fades away, we forget why this goal was so important to us. We feel sorry for saving money on it, and in the end we just throw it away. Therefore, it is so important to find ways not to forget about big goals while slowly moving towards them.

Do something that will help you save

Think about what proactive actions can help you save money and invest in a bigger goal. It may be worth preparing food in advance and freezing portions for future use, repairing minor breakdowns of the car yourself, or insulating the apartment.

Do something that will help increase your income

You can start a micro-business in your spare time, for example, open your own YouTube channel. You can get additional education or take refresher courses. You can simply put in more effort at work to get a promotion. You just need to try and find the time for this.

Find like-minded people

Look for like-minded groups in your city, such as the Meetup website. Communicating with people who, like you, strive to save money or start their own business, will help you find inspiration and strength to start moving in the right direction.

4. Financial goals seem out of reach

When your financial goal is many times your annual income (as is the case with retirement savings), it may seem like it’s impossible to achieve it at all. But you don't have to give up.

Break a big goal into small steps

The final amount may seem unattainable, but what about the first milestone on the way to the goal? This amount is no longer so scary. Try to divide your big goal into several stages, for example, with a year gap between them. Going through stage by stage, you will gradually reach the final goal.

Remember what is important to you besides finance

Don't just focus on money, think about other areas of your life as well. What is really important to you? What are you spending your time on? Are you satisfied with where you live? Are you satisfied with your job?

When we change for the better at least one thing, big goals no longer seem so scary and it becomes easier to achieve them.

Make your goal more realistic if it looks overwhelming

If you have broken the goal into small steps and tried to find a new approach to spending, and the amount still remains unattainable, then you simply overestimated it. If so, don't be afraid to change your expectations. Try to find a way to cut the amount you are aiming for. Or move your goal forward several years so that you have enough time to reach it.

5. Life constantly interferes with our plans

No matter how good your plan is, life will always make its own adjustments to it. You may lose your job or get sick. Your car may break down or your neighbors may flood you. Because of such unforeseen spending, we deviate from the goal and lose faith in its attainability. Try to protect yourself from these kinds of problems.

Create a contingency fund

This is not so difficult to do. Open a separate account and transfer small amounts to it every week. If possible, set up automatic translation. That's all. Now, when something happens, you don't have to panic or borrow money.

Of course, you can use a credit card as a last resort, but you need to be careful with it. If you accumulate debt on such a card, you will only complicate your life even more.

Reduce unnecessary risks

Think about what is most likely to prevent you from achieving your goal. Perhaps you have health problems or know that your car is about to break down. Try to identify these risks in your life and reduce their number.

Prepare in advance for upcoming spending

You know when you have to pay bills and taxes, so why not prepare ahead of time? Start saving money for these kinds of expenses so that they don't distract you on your way to your big financial goal.

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