Submitted by Rachel R on Wed, 01/06/2016 - 9:33am
Read the latest poll results on savings goals
Image Source: Flickr User secretlondon123
Financial polls by GOBankingRates.com and FidelityInvestments.com show that many consumers want to do more financially in the New Year, and that means saving money. Most want to save, but think there are too many obstacles in their way. Here’s a look at some of the excuses not to save and how you can push past these hurdles to have a brighter financial future by saving today.
Poll results on saving
A GOBankingRates poll showed that more than 37% of respondents rank saving money as a critical financial goal while a little under 25% see paying down debt as most important. Improving spending habits, investing and trying to get a raise round out the top five goals for a better financial future. Those poll results are nationwide – but in the South, more respondents wanted to focus on debt than savings.
Poll results on excuses not to save
Asset management firm Black Rock ran a poll of 4000 Americans asking what were the barriers to not saving money as they know they should. The top three excuses were:
How to overcome the excuses and save more in 2016
Excuse: “I don’t earn enough money to save.”
Those that say they don’t earn enough need to dig into what that means. It may not be that you’re not earning enough, but your expenses are too great and out of alignment with what you make. Often people make major decisions at the height of their earnings potential and overbuy on their mortgage or auto loan. Borrowing at the maximum limit you are able can make it feel like you don’t earn enough.
In fact, it’s more likely that you have overextended yourself on obligations. Cutting back on expenses is a must if you want to get on a program to save regularly. You can’t wait until your income increases – saving should start ASAP. Look at your discretionary spending, where you can cut back, and give it a try. You may find once you make the adjustment, it’s not hard to live with less so you can set aside more.
Excuse: “My cost of living is too high.”
The cost of living the life you’d prefer to live may be too high, but the cost of living the life you can afford to live is another thing. Many of us have in mind the lifestyle we aspire to, and we spend as if we were already there. Bad habits like this can short-circuit the chances of you ever getting to that point. When you get a raise, you don’t need to adjust your spending up – adjust your savings instead.
Look for opportunities to save instead of opportunities to spend. Instead of setting a spending goal such as – I want a new car next year, think instead of – I want to max out my 401(k) next year. By adjusting your mindset away from a focus on spending and towards savings, you can build momentum to get yourself on track financially.
Excuse: “I was hit by unplanned expenses.”
This can happen to anyone. If you have an emergency fund – which requires establishing good habits to save regularly – you may be able to ward off a financial crisis when unplanned expenses arise. An emergency fund should have enough in it to cover the cost of a major car repair, big appliance failure (like a fridge) or a week or two out of work with no income – and that’s at a minimum.
If you don’t have that rainy day fund buffer, you may have to max out credit cards, borrow from family, take advances on your paycheck or other poor financial solutions. And if your unplanned expenses are even more catastrophic – such as a serious illness or accident of you or a family member – you may need to consider a debt relief intervention.
How bankruptcy can get your finances back on track
It can be hard to think about saving when your life is consumed by debt. No matter how much you earn, you can find yourself living paycheck to paycheck, maxed out on credit lines, and fielding harassing calls from debt collectors. If you are in so deep that you can’t claw your way out, you may need a more meaningful solution – bankruptcy could help you.
Chapter 7 bankruptcy wipes out unsecured debt like credit cards and medical bills while Chapter 13 buys you time to catch up on your mortgage or car loan and discharge some of your unsecured obligations. Both chapters can be used to ward of auto repossession or home foreclosure. Which is best for you depends on your unique circumstances.
Contact the Law Offices of John T. Orcutt today for a free North Carolina bankruptcy consultation. Call +1-919-646-2654 now for a free appointment at one of our locations in Raleigh, Durham, Fayetteville, Wilson, Greensboro, Garner or Wilmington. Come talk to us about your debt issues – we can help.
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