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How to stick to your saving goals

Much is written about how to save: “You there, you reckless spendthrift, come here and read my secret formula that will turn you into a prudent accumulator of wealth.”

Far less time is devoted to the difficulties of staying the course.

What are the techniques that will enable you to stick to your savings goals through the long days ahead? The times when your entire being just screams out for a foam-plumed latte with an extra fancy shot? Or those new shoes? Or that shiny, new car? How do you deal with the urge to splurge?

You need a defense-mechanism, my friend (and I’m looking in the mirror here).

Two tactics make the difference for me:

  1. The long-term goal
  2. My monthly savings target

The long-term goal

Knowing where I’m going helps keep my eyes fixed on the distant horizon. When I can imagine how wonderful journey’s end will be, I don’t resent every heavy plod that carries me one step closer.

My initial goal was an emergency fund. Now it’s paying off the mortgage double-quick. Other popular goals include:

  • A comfortable retirement
  • Income supplement
  • Property purchase
  • The kids’ education

Without my goal I’d have nothing to fight for. No ultimate dream that makes today’s sacrifice worthwhile.

But it’s important that dream is defined. That it’s a concrete number I can hit. Vague notions of ‘financial security’ are too woolly and abstract to sustain a long-term commitment. If the goal isn’t defined then you can’t draw psychic sustenance from beating your numbers.

Many are the days that I go into work and steel myself with the thought that the trials ahead will bring me a step closer to my endgame, provided I stick to my saving goals.

Note: Choosing too many savings goals is as fatal as failing to define any. When the enormity of the task dwarves your resources, then defeatism and failure will surely follow.

Savings targets

Stay on target

Defining your goal means setting a target. My long-term goal is a large and distant one. It’s a big problem that can only be beaten if I break it up into many smaller problems that can be picked off one-by-one.

Creating the opportunity to win a string of handsome victories is critical to building morale, momentum, and ultimate success. Set yourself:

  1. A yearly target
  2. A monthly target

If I can save (and therefore invest) X every month and Y every year then I’ll hit my target in W years.

Targets may have a bad rap in the NHS, but I’d never stay the course without them.

Knowing I have to hit my monthly target electrifies every spending decision I make. Every decision now has a purpose:

  • If I don’t splash out then I’ve made progress towards my goal.
  • If I do, it’s because I really want or need the thing I’ve bought.

Crucially, the target makes me think things through. I no longer make thoughtless impulse purchases that amount to money down the pan. (Well, not often anyway).

Budget control

One tool that helps me stick to saving goals is my Budget_Control spreadsheet.

It’s very simple. The spreadsheet:

Adds up income, subtracts spending, and shows what’s left.

It also sets predefined monthly limits for spending in cash and on credit cards. Knowing what those limits are – and checking how I’m doing every week using online accounts – enables me to ease off the spending throttle when I’m having a bad month.

I use monthly direct debits to siphon off cash into savings accounts and to a regular investment scheme. The Budget Control sheet enables me to watch with pleasure as that amount grows in the ‘saved’ row.

As is often noted, you soon learn to live within your new means when cash is hived off automatically. Human inertia can work in your favour!

How to use the Budget Control spreadsheet: You can download the spreadsheet via the link above. The numbers already in the sheet refer to the spending targets set for credit cards and cash. Choose your own. The cash category covers ATM withdrawals, BACS transfers or debit card payments. Most of my spending is on cashback credit cards (paid off in full every month), so most outgoings are tracked by knowing these numbers. I’m not one for painstakingly totting up every till receipt. Regular bills are paid on direct debit.

Any spare money (the surplus category in the spreadsheet) also gets saved and ultimately invested. This is a movable feast that depends on how successfully I’ve fought spending on cash and credit cards that month.

The tension between trying to stay within the spending limits and the desire to generate a savings surplus creates the drive to stick to the plan.

Tracking my saving and spending also enables me to set realistic saving goals that are within my means. Progress relies on those handsome victories referred to earlier. Constant defeat would soon stall the project.

And a target-adjustment will probably be required very soon as the rising tide of National Insurance, tax hikes, and inflation continue to lap at all our saving sandcastles.

Take it steady,

The Accumulator

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{ 5 comments… add one }
  • 1 ermine March 8, 2011, 12:57 pm

    One of the techniques that really helped me was a thirty-day embargo on consumer purchases. ie if I had a desire for some consumer item, stick it on a list and park it. If after thirty days it still seems like a good idea, go for it.

    30 days gives enough time to reflect, and eliminated 95% of my purchases – by then I’d usually found a way round it or it simply didn’t matter that much to me anyway. It sterilises the power of advertising stone cold.

    Obviously you have to make an exception for consumables and things like safety equipment, but it’s been a total cure for gadget addiction 🙂 Yes, you miss out on sales and stuff, but the saving on the stuff you don’t buy means you don’t need to care about that.

  • 2 Moneyman March 8, 2011, 7:02 pm

    Another tip would be to automate your savings as much as possible – ‘paying yourself’ first, for example with a regular saver account (or two). In a way this gives you a monthly budget to stay within.

    As you say, everyone should have a budget spreadsheet (if only to know what the biggest expenditure items are – and therefore to know which to tackle first) – but everyone should also have a ‘financial plan’ spreadsheet – showing how they think their wealth is likely to grow over the next couple of years. In my case, seeing how those early estimates were far exceeded, after only a couple of years has been a great encouragement to try even harder.

  • 3 The Accumulator March 10, 2011, 9:53 pm

    Excellent tips. Ermine, I think my equivalent of your 30-day rule is that I make myself research most purchases. That inevitably means they hang around on a ‘to do’ list for a good while before I get around to investigating possibilities. By then, the ardour has normally faded.

    Moneyman, I like the idea of having a financial plan spreadsheet. Although I know what my target is and what I have to do to get there, I hadn’t thought to map out the milestones in advance. I guess if you keep the early estimates cautious then you’ve got a good chance of overshooting with all the positive affects that has on morale.

  • 4 Kagem January 10, 2012, 1:12 pm

    I fail at my savings goals because sometimes they are too lofty but then when I forget about it for a while but keep putting money away without checking it all the time, I feel like I have saved more. It must be a psychological thing.

  • 5 Ajay Pruthi December 24, 2014, 12:01 pm


    I think instead of: Adds up income, subtracts spending, and shows what’s left.

    It should be: Adds up income, subtracts saving, and see what’s left.

    The amount that is left is the amount you should spend. The savings should be automated. It should get deducted from you account in the beginning of month.

    If you know “I have this much of money to spend”, then you will take care of your money.

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