- November 21, 2018
- Posted by: Ethica Private Wealth
- Category: Blog
Whether you’re thinking ahead to the far future or planning to retire in the next few years, beginning your retirement planning can be difficult. Once you have a plan in place, it can be even more difficult to stay on track and maintain the positive mindset required to achieve your savings goals. If you’re having trouble mastering the money-saving mindset, this article could help you to get on the right track for achieving your goals – just follow these eight simple steps.
1. Set a Clear Goal
When you first start retirement planning, the first thing you will want to do is set a clear goal for your savings. It’s not uncommon for people to spend years telling themselves they will save a little here and there, and then find that they’ve really saved nothing at the end of it. By setting a clear goal to work towards, you will be able to more easily track the progress of your savings and feel more committed to achieving it.
2. Write Down Your Budget and Update it Regularly
Once you’ve decided how much you want to save and in how many years, you should write it all down and create a budget that you can stick to. Have a think about what you spend, how much you earn, and how much you can save each month. When it’s all laid out in front of you, it’s much easier to get a clear picture of your saving potential and create a plan. You should also try to track any overspending and factor in any extra earnings so that you have accurate figures to work with. When you try to keep all that information in your head without writing it down, it’s easy to become disillusioned with saving and renegade on your goals.
3. Take Care of Destructive Debts
Destructive debts are debts that constantly exceed the amount you expect to pay each month. Often, credit cards that aren’t managed properly and loans can apply fees which can cause your budgeting to be thrown out of whack in order to account for the higher amount. It can become extremely disheartening if you are paying out more than you budgeted each month and can cause you to fall out of a healthy saving mindset. Before you put your strict budget in place, try to ensure that all of your payments are up to date so that you aren’t falling victim to added fees.
4. Treat Yourself Every So Often
When you begin to budget and save for your retirement, you will probably cut back on a lot of luxuries that you usually enjoy. You may decide to stop eating out at restaurants or stop going to the pub after work. Whilst this is a great way to save extra money, it can also cause you to have a negative attitude towards saving if you’re constantly missing out on the things you enjoy. It’s often more productive to give yourself a treat on a regular basis that you can look forward to, or choose to celebrate when you reach certain saving milestones. Whatever you choose, it will help you to maintain a positive and healthy attitude towards your retirement goals.
5. Don’t Waste Unaccounted-for Money
Although it doesn’t happen very often, you may end up coming into money that you hadn’t accounted for in your original budget. Whilst it’s very tempting to blow the extra cash on something you’ve been eyeing up at the mall, it could be a better idea to add the extra money to your retirement fund. Extra funds can help to create a surplus which can act as a buffer in the future if any unexpected costs crop up. When you have this buffer, it can help you to stay motivated as unexpected costs won’t have as much of an impact on your original planning.
6. Make Money Saving Your Hobby
In order to save extra money in the run-up for retirement, a lot of people will choose to cut back on costs that usually pay for activities that keep you occupied and entertained. This can be disheartening, but you can combat the boredom blues by turning money-saving into a new hobby. There are so many forums and blogs online which people use to share their money-saving journeys and learn new tips and tricks for saving. As well as this, there are smartphone apps that you can use to gain extra savings at popular stores and earn coupon vouchers. Getting involved in the online money saving community can help you to stay motivated towards your goals and may even help you to save a little bit of extra cash that you hadn’t accounted for.
7. Share Your Goals
When you finally get around to putting in place a savings goal, it could be a good idea to share your goal with someone else. This could be a friend, a family member, or a financial advisor. By sharing your goals, it can help to make you feel more committed and if you so wish to, your savings buddy could also hold you accountable for reaching your goal by encouraging you to stay on track with your budgeting, and offering friendly warnings if you are spending too much on a night out! How much input you want people to have is up to you, but being open and sharing your goals can really help you to bring what’s going on in your head into reality.
Having the right mindset when saving is essential to achieving your retirement goals
Whether you’re starting early or need to save quickly, putting a plan down on paper can really help you on the way to reaching your goals.
If you need a helping hand mastering the money-saving mindset, the retirement planning team at Ethica Private Wealth Specialists can offer you the support you need.