Saving = Financial Security 😎
Saving money is one of the most important steps toward financial security, but for many, it feels like an uphill battle. Often, it’s not just about how much we earn or spend—our mindsets and behaviors can play a significant role in preventing us from building a practical savings plan. Behavioral economics tells us that the way we think about money impacts our ability to take action. In this article, we’ll walk you through three simple strategies for creating a savings plan that’s easy to stick to, and we’ll show how shifting your mindset can help you save more effectively.
1. Start with Clear and Achievable Savings Goals
When Gabe started his career in the Bay Area, he felt strapped for cash. It seemed impossible to start contributing to his 401(k), but he decided to start small with just $100. Once he made that initial contribution, he realized he didn’t even miss the money. Over time, he began contributing more as his confidence grew, eventually seeing his retirement account grow significantly. His goal of building a retirement fund started with that small step, proving that getting started—even with a modest amount—can build momentum.
This example shows that saving doesn’t have to be overwhelming. Start with a small, achievable goal like contributing a modest amount to your savings or retirement. As you build confidence, you can gradually increase your contributions and watch your savings grow.
Automate Your Savings to Make Saving Money Effortless
Many people resist saving because they feel, "Saving means sacrificing what I want now." This mindset creates a feeling of deprivation, making it harder to stick to a plan. However, the strategy of paying yourself first—setting aside savings before spending—helps to reframe this thinking. When you prioritize saving, you’re ensuring that your financial future comes first.
At one point in my career, I received a significant salary bump and was determined to build my emergency fund. Instead of increasing my lifestyle expenses, I kept them the same and set up automatic transfers: $1,000 into my savings account (though I wish I had chosen a high-yield savings account back then) and $500 into my individual brokerage account. I was already maxing out my 401(k) contributions, so I had multiple savings goals at once. But I treated these new accounts as untouchable. For me, these savings contributions were non-negotiable—just like paying rent or bills—rather than something I’d opt into when it was convenient.
This "pay yourself first" approach ensured that saving was a mandatory part of my budget, not an afterthought. By prioritizing these automatic transfers, I was able to grow my emergency fund and investments without feeling deprived of my daily needs.
Why Most People Don't Save Money
Saving money is not just a numbers game—it’s a mindset game.
Here are some common mindsets that hold people back from taking action on their savings plans, along with tips on how to overcome them.
First common belief, "I’ll get serious about saving later."
Procrastination can lead to financial stagnation. The best time to start saving is today, even if it’s just a small amount. Taking that first step can create momentum. In fact, nearly 6 in 10 (59 percent) U.S. adults are uncomfortable with their level of emergency savings, according to a new Bankrate poll.
With inflation and interest rates rising, it’s even more important to start saving, even if it feels uncomfortable. I remember when I first started using the Qapital app, I was hesitant and worried that I wouldn’t have enough to cover my everyday expenses. But once I started, I realized I was fine. As I watched my savings grow, it encouraged me to sit down and create a budget so I could assess whether I could save more each month. There really is no "right way" to do things, just as long as you are doing something. You can always adjust as you gain more confidence.
Second common belief is, "I’m not good with money."
Unfortunately, many people get stuck looking in the rearview mirror, focusing on past money mistakes and attaching judgment to them. The key is to give yourself grace for those mistakes and commit to learning about money moving forward. Anything is possible with the right mindset. I often think back and wish someone had taught me about budgeting, investing, and saving when I was younger, so I could have benefited both then and now. But the reality is, we’re all on our own financial journey. It’s important to allow ourselves the space to make mistakes while also holding ourselves accountable today for the sake of our future selves.
This belief can stop you before you even begin. Building savings doesn’t require special skills—start simple and gradually build confidence by automating savings and hitting small goals. Celebrate those small victories to reinforce positive behavior.
Third common belief is, "I have too many expenses right now."
Instead of thinking there’s no room to save, look for ways to cut back on non-essential spending and start small. Even saving a few dollars a week can add up over time.
There’s always room to cut expenses or increase income. When I first moved to the Bay Area to start my career, I was barely making enough to cover the basics. I quickly realized I needed to find a way to earn more to not only survive but thrive. That’s when I landed a soccer coaching gig and took on two teams. The extra income gave me the financial breathing room I needed to cover my bills and start saving a little each month. While I didn’t have my tax strategy dialed in at the time, those savings helped me when I later quit my job to start grad school.
Throughout my money journey—and even now—I encounter limiting and sometimes false beliefs about my finances. It’s essential to reflect on these thoughts and ensure they aren't getting in the way of my progress. By challenging these mindsets, I’ve learned to take action and prioritize my savings, paving the way for a more secure financial future.
Start Your Savings Journey Today
Creating a practical savings plan doesn’t have to be difficult. By setting clear goals, automating your savings, paying yourself first, and addressing mindset barriers, you can start saving money more effectively and build healthy financial habits. Behavioral economics teaches us that small, consistent actions lead to big results. The key is to start now, however small, and stay consistent.
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