Major Money-Saving Mistakes

Saving money is very important to staying happy. You will always stay more content and satisfied if you have money that you can use to save you from trouble. Savingmoney is really difficult even for the people that are not known as spenders. At times, even the banks that we keep our money with, prevent us from saving. Following are four major money-saving mistakes that people usually make:

1.      Saving the leftover amount

People would usually think that they’d take out all the expenses and then save whatever is left from the salary. However, this is a very bad approach as it lures you into a false feeling of security that makes you think you have more to spend, while you actually do not. The best way to save instead is to think through your expenses and then designate a particular amount to savings. When you get your salary, the first thing you can do, is pick out the savings amount first. What is left in the pool is eventually there to spend.

2.      Interlinked checking and savings accounts

It might seem really convenient, but it is a bad idea to have your savings and checking accounts linked. When you have gone over the limit with your current account, the bank would automatically divert the transactions from your savings account. Hence, if you want to save money and keep a track of it, you better keep them unlinked. In fact, it is even better if you don’t have an ATM for your savings account. Make it a little difficult to access your savings, so that you’d only withdraw in case of emergencies.

3.      Keeping all savings in one place

It feels really good to watch your savings grow when you’ve put them in one place. However, as finance gurus say, diversification is very important to minimizing risk. If you put everything in one place, it is not only a bit risky, but it is also deceiving. You end up thinking that you actually have much money for purchases. Hence, it is best if you have your savings divided into multiple accounts or even invested in gold and stocks if you have a bigger pool for investment.

4.      Saving only the large windfalls

If you get money in big chunks which you can save directly, then it must be no problem for you to borrow it back. However, it is also important to save on a daily basis. Pick out money from your salary and save it before you start to spend. Managing your savings and spending will also contribute to a better macroeconomic situation.