Why You Want to Save Money and What You’re Willing to Do About It

One of the things I’ve learned along my own frugal journey and through helping others with their financial problems is that the reasons behind living frugally/saving money often dictate just how far a person is willing to go in order to cut spending. I’ve learned that in order to have the greatest chance of success, you must first know exactly why you want to save money because that reason often dictates your savings strategies.

There are many reasons why people choose to save money and/or cut consumption. They may want to pay off debt, save for a specific goal like a car or a trip, create an emergency fund, pay for education, ensure a comfortable retirement, or to reduce their impact on the environment.

Just as there are many reasons to save money, there a many different ways to go about it. You can have a set amount deducted from each check and put into an account. You can give up things like eating out, cable, and trips to the movies. You can clip coupons and shop sales. You can give up vices like cigarettes and your morning Starbucks. You can do home maintenance yourself. You can make your own cleaning products. You can take a second job and earn more money. You can sell stuff you don’t need. The list goes on.

The thing is, while every savings strategy will save you money, not every strategy works well with every reason for saving. For example, the person who wants to cut consumption/spending for environmental reasons may decide that making his own laundry detergent is worth the effort because the end product is less toxic to the environment. But this same environmentalist wouldn’t see the benefit in taking another job because the commute would be detrimental to his goal of helping the environment. On the other hand, the family looking to pay down debt may decide that the time and effort required to make their own detergent could be better spent working a second job and then getting the best deal they can on store bought detergent.

Similarly, the family that has no debt and wants to save up an emergency fund quickly may have no trouble selling things they don’t need and skipping the annual vacation in order to gain large chunks of cash in a hurry, but they may not see the value in clipping coupons and giving up the daily Starbucks. But the person who wants to save for a college education far in the future may decide that they have plenty of time to save up and opt for smaller changes to the budget over time, such as giving up Starbucks every other week, or cutting meals out down from two to one per week. They may not be as willing to give up big fun in the “now” for a savings goal that’s far in the future.

Generally speaking, big goals that are coming up fast (retirement’s five years away, you know you’re going to need a car this year, you want to pay of $20K in debt this year, you have nothing in the emergency fund and you want $5,000 this year, etc.) require more aggressive savings strategies. You may need that second job, you may have to sell that car, you may have to sell a lot of stuff, or you may even have to downsize your house in order to raise big chunks of cash quickly. Smaller saving strategies like coupons, electricity conservation, and switching to store brands will certainly help and will get you there faster, but they won’t give you the big bucks that, say, another job will. You have to ask which is more worth your time and effort to reach your goal.

On the other hand smaller goals, or big goals that are a long way off (a vacation with a date to be determined, retirement’s thirty years away, a college education for a yet to be born child, adding to an already funded emergency fund, etc.), can be accomplished with less drastic measures. Clipping coupons and putting the savings in the bank, automatic deductions from a paycheck, giving up the daily coffee, making your own lunch and eating out less can all help you save up a little at a time without requiring drastic lifestyle changes. Big changes and money raising ideas will certainly get you there faster, but you may end up resenting giving up the vacation or selling your prized guitar if another method would work.

Of course if you’re in a big financial hole, you may need to do everything large and small to get out of it. You may only be able to save your sinking ship by taking a second job, couponing, selling your stuff, and cutting out everything not essential for survival. But once you get that sorted out and you’re looking at more manageable goals, knowing why you’re saving is as important as the method you choose.

In order to understand the strategies that are most likely to help you reach your goal in the least amount of time and with the least amount of hassle, you have to know why you’re trying to save. If you don’t know and understand that, saving money becomes like throwing spaghetti at a wall. You try every strategy you run across and throw it all out there, but only a little bit sticks and you have to clean the rest up off the floor. When you fully understand where you’re trying to go, you’re better able to pick the best strategies to help you get there.

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9 Responses to Why You Want to Save Money and What You’re Willing to Do About It

  1. kenyantykoon says:

    i like this post. my goals are big businesses and a sound financial/investment base and so that is what i work towards, i have channeled ALL my money towards these two goals and working hard to achieve them in a specified period. i really dont save money in the bank but look for other investments with the same characteristics as a savings account like a money market mutual fund. instead of money sitting in the bank, i invest it in my financial education and my goals

  2. Adi says:

    I really like the post, I have been a saving person for quite some time now but I never had any specific goal! The sooner I created a logical goal in my mind (the car I always wanted to buy) the better was the visibility towards this target.Now am a much organized person with practically possible goals and I am saving towards it, month on month…

  3. The old path says know where you were, know where you are, and you’ll know where you’re going.

  4. SMB Kev says:

    The thing I find difficult is prioritizing my saving efforts. Should I be accumulating my emergency fund or trying to max out my IRA or contributing to my money market fund? I guess picking one is better than fretting over which to choose because in reality achieving any savings goal you set is beneficial. The plan to get there though, to reiterate your point, is an important part of that success.

  5. Minny says:

    What many people don’t realise is that money saved gives you freedom and choice. Like paying off your mortgage frees you up from being tied to a life you hate or want to change and can’t. I would rather have something small and paid for than large and mortgaged.

    When I save, every time I look at my bank balance I know that I am better able to deal with what life may throw at me. If my clunker car dies, I am able to negotiate hard for its replacement because I can pay cash.

    So, for me the saving was for that freedom and choice. It gives me a nice warm feeling.

  6. Rick says:

    Good Article.
    Everyone has their motivation for savings. We decided to save more and start paying down our debts when we saw how much we would have to save in order to have 6 month’s expenses. It was a real eye opener. We realized that if one of us lost our jobs for even a short amount of time, we’d be in trouble.

  7. Junebaby says:


  8. This is a good post.

    I never really thought about it this way, but this is very true. Sometimes I think that people don’t realize that if they continue their current spending habits that in the end they will be in a world of trouble (therefore they don’t see “why” they should make a change). So a clear picture must be painted.

    But then on the other hand, maybe some people do know, but are just content with living life one day at a time.

  9. Teamgav says:

    We live in a small house in a bad part of town. We are debt free apart from the house. My partner works and earns our only income. I look after things at home. To the outside world we look as though we couldn’t afford a new pair of shoes but we take our kids on fantastic holidays. How? We save for them.
    Next year we are going on a 10 night cruise around the south pacific. By researching different option and booking early we saved 50%. The booking confirmation is on the back of the front door so everything we leave the house we know what we are saving for.

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