What If I Can't Save Money Right Now?

This blog and website are all about helping you get your finances in order. And what we hear a lot is, I'd love to do better with my finances, but I just can't. We hear either, I can't afford to save, or I have debt that I have to pay off first.

Let's address these concerns in order, but first, we want to point out that we believe you. Your concerns are real and you're not an idiot- you're not making up obstacles to a better financial future because it's fun, right?

You want to do better with your finances, or you wouldn't be reading this right now. You just don't know how- and that's perfectly normal. We certainly don't get taught about how money works in school. Our parents might tell us "pay your bills on time" or "don't spend more than you make"; but have they taught you how to do that? If you're lucky, then yes; if you're like most of us... then you have to figure that out on your own. After you move out of your parents' house! 😆😥

So here at Smart Money, we believe that you are doing the best you can with what you have. We are here to equip you with better tools, better mindset, and better understanding. Let's start:

"I just can't do better with my finances right now"

We know it feels like that. Here's some food for thought, though: It will always feel like that. The key here is to really confront those last two words: right now. Making changes to your finances would be really hard right now... but when will they feel easier?

Maybe when you get a better job, a raise, or a better schedule? Well, when you get a better job, you'll have more responsibilities; when you get a raise, you'll find more to spend your money on; and when you get a better schedule, you'll find fun hobbies, projects, or friends to spend more time with.

Remember, the best time to plant a tree is twenty years ago; the second best time is today.

You can always do the best you can, with what you have, right now in this very moment. You never have to wait again for things to change. Isn't that exciting?

We mean it! Isn't it exciting to know that you don't have to wait, to start saving? We think so!

You don't have to be perfect, and of course what "saving up" looks like now, isn't what it will look like five years from now. That's fine too. The point is- start today!

But How?

If I feel like I can't save at all, how am I supposed to start? Start with little things! Here's the top 3 tips to start saving today, no matter where you are in your financial journey:

1. Give up 1 habit- and prioritize 1 habit. Find one thing you don't want to stop spending money on.
   (Hopefully, that's not your most expensive habit 😆)
   People we work with have prioritized a daily soda; getting their nails done or a monthly massage; marijuana; and a monthly road trip.
   Then, list one to three things you're willing to stop spending money on. People have ditched soda; cigarettes; marijuana; kitchen utensils (yes, they had a monthly budget for that); and more.
   People can also choose to reduce spending by quite a bit, but not cut things out completely. Most often, we've seen people do that for Starbucks/coffee out; eating out at restaurants; concert tickets; and spending on clothing.
2. Replace a habit. This is a fun thing to think about as well. What are ways that you can have the same fun- without the same amount of spending? Think about why you spend money on a habit, and brainstorm ways that you can get the same feeling in a different way:
   1. You might eat out a lot because you like spending time with friends, or you don't like cleaning the kitchen. Instead, cook together or go on walks with friends; or trade "I'll cook/you clean" with your partner or roommate.
   2. You might stop by 7Eleven for a daily soda or snack. Instead, buy those things in bulk at the grocery store or membership clubs like Sam's Club or Costco.
   3. If you love spending time with friends, suggest going for a walk or having a weekly picnic in the park. The novelty alone would be a fun reason to try it, and you can still see friends without spending money on expensive cocktails, movies, or meals.
3. Save $1/day. Every day of every week, start saving one dollar. The easiest way to do this is to set up an auto-pay from your bank account; every single day, transfer one dollar from your checking account into a savings account.
   Once that feels easy to do, up your automatic savings to $2/day. Then $3, or $5, or $10. This will add up to $30 to $300 per month- wow! You'll really make headway towards your financial and savings goals if you do this.
   $1/day is still out of reach? No problem- start saving $1/week, then move up to $2/week, then $5/week, then $1/day. Once you build momentum, you will always be motivated to continue with it. You can't do everything at once- but you can start somewhere 👍

Now that you know how to build tiny habits that will make a BIG difference in your finances, let's go back to some of those other obstacles...

I Can't Afford to Save Money

Again, we believe you. Every one of your dollars has a job already, and you're not sure how to re-allocate those dollars to start moving towards your bigger financial goals.

Here's how you can change that status quo: First, start putting those three habits above into place.

Second, start thinking about your money differently: if you can't afford to save money... then you really can't afford a financial emergency 😳

Without any financial cushion at all, every financial setback threatens to send you back into the rabbit-hole of debt. If you're in this position, then you can't afford not to save 🤷🏻‍♀️

Your first response to that is probably, Well that won't happen to me. Okay, let's say you're right; you find a way to save money, but you never have a financial emergency and you never need that cushion. Are you ever going to regret saving that money? Absolutely not.

But let's say Bad Stuff Happens to you: a health emergency for you... a parent, partner, or heaven forbid, your child. A fire, storm, or tornado that ravages your city. A job loss, an economic downturn, an auto accident. Most negative things that happen to us have financial consequences- even when the problem wasn't our fault!

It doesn't matter what happens, why, OR who's at fault; a financial cushion can mean the difference between being able to take time off work- or not; being able to follow the doctor's best recommendations- or not; going into debt- or not; even losing your home or lifestyle- or being able to maintain it, even through a financial setback.

You might think that, even if you start saving $1/day, that's not enough to create a financial cushion. And you're absolutely right! But here's how the human brain works: Let's say you start saving $1/day. You feel pretty good that you have $30 at the end of the month. At the end of three months, you have almost $100 and that feels even better.

Your brain, throughout that three months, starts to recognize opportunities: If I don't buy that item in the checkout lane, I could save an extra $3 today. Do that several times a month... and you're no longer saving $1/day, you're saving much more.

The human brain loves patterns, so once you start saving money, your brain will encourage you to do it more often. That's why saving helps you build momentum; because eventually, your brain and all your decision-making starts working towards the same momentum.

Do yourself a favor that will last a lifetime- start saving today, even just $1 or $5 a day.

Now let's look at that last common reason that most people can't save... and our response to that is going to shock you.

I Can't Save Because I Am Paying Off Debt

If you can't save for the future because you're focusing on paying off debt... then we applaud your good judgment.

You read that right 😊 You have a certain amount of dollars, and you're putting them where they'll do you the most good: paying down debt- which also improves your credit. That is excellent decision-making and you should keep it up!

Once you pay off/pay down your debt, then you'll have a few extra dollars. When that happens, then put some of that money into savings- you'll avoid going down the debt rabbit-hole in the future, you'll build good savings habits... and that will all build your momentum towards the financial future that you really want.

No matter what stage of life you're in, and no matter what financial, emotional, or life situation you're in right now- you can always take small steps towards the financial future that you want.

Now That's Smart Money 🧐