Are those shiny New Year's savings resolutions slipping already? Frances Cook explains how to get back on track.
We’ve all been there. The rush of excitement as the New Year hits, the glowing certainty that this is the year we’ll actually transform ourselves into a whole new person, and the lofty goals we set that we hope will get us there.
Then a few weeks tick by, it’s not even February and we’re well and truly off the wagon.
It’s pure human nature for motivation to fade, which is why with savings, as in any other area of life, we need tools and tactics to help us stick to our plans.
Make your goals exciting
One of the biggest barriers to saving is the unspoken idea that to be "good" with money, we should be miserable.
Squirrel it all away because you "should", not because there’s any purpose for it. Down that road, there’s only misery and giving up. Because why make sacrifices for something you can't even envision?
Instead, think about what you actually want out of life, and how you’re using your money to get there. Do you want to feel more secure? Have a stash ready for emergencies? Go on a holiday?
A savings account isn’t just a pile of money. It’s the freedom to fix your car without stressing about credit card debt, or to be able to fly out for a family emergency without hesitation.
None of these goals are better than the others. What’s important about a goal is that it mean something to you. Know what you're saving for, and make sure it's something that truly reflects your values and desires. That’s the only way you’ll actually stick with this.
Automate, automate, automate
Once you’ve got a meaningful goal, you’ve got to make reaching it as painless as possible. This is where automation becomes your best friend.
Create a regular autopayment for the day after each payday, so that it happens without you needing to think about it.
Lost motivation that week? Doesn’t matter, the transfer already happened in the background. Can you really be bothered to go and get it back out? Probably not.
Whether it’s $10, $20, or $50 a week, any amount is better than $0 a week.
The trick is to make saving a habit, not a decision you have to wrestle with every payday.
And don’t forget to budget for fun. Savings isn’t about self-denial – it’s about balance.
Even if you’re on a tight budget, $10 a week for a quiet coffee in a pretty spot could be the difference between keeping your sanity, or finally snapping and thinking “I can’t live life like this anymore”, and blowing all of your hard work. Give yourself the gift of manageable treats, so that you stay on track for the bigger wins.
Kiwis who save are in the minority, but it only takes a few dollars
The 2024 Kiwibank Annual State of Savings Index found that only 41% of New Zealanders regularly save money.
In fact, one in three of us would struggle to cover an unexpected bill of $500 without borrowing, putting it on a credit card, or selling something.
Despite this, we’ve still got goals, the most common being to build an emergency fund (44%) go on holiday (36%), stash cash for retirement (31%) or buy a home (20%).
Kiwibank’s Hayley Titosays she thinks of a goal, and purpose, as two different things.
Having a purpose is what makes the motivation kick up a gear. “You can have a goal that says, ‘I want $5000 in my emergency fund,’ but think about the why: is it so you can sleep better at night? So you can cover a car repair? Or so you can afford to travel for a family tangi if needed?
“Even if you can only afford to put aside a small amount of money each pay, just do it. Those few dollars will eventually add up and start forming a good saving habit.”
Get into sprint mode
Sometimes you have to make some hard choices on the way to bigger money goals. So how do you balance that, and the knowledge that you can’t be locked down forever, or you’ll snap?
The answer? Sprint mode.
Set a deadline for building that emergency fund, or paying off debt. It shouldn’t be more than a few months. If you’ll need longer than that, create a milestone on the way to that end goal, and aim for the closer milestone instead.
Then, put your money into lockdown, and make a sprint effort for a couple of months.
Once you hit that goal, celebrate. Give yourself a couple of weeks of normal living, without undoing all of the hard work. Then create the next goal, and decide if you’re ready to sprint again.
Sprints always need an end date. You can’t go full steam forever, so build in time to catch your breath and ease into a more sustainable plan.
At the end of the day, you’ll only stick with a money change if it doesn’t make you miserable.
The key to motivation for any change, but especially with money, is about forgetting what you ‘should’ do. Instead, focus on how to build a life you love, and create a system that helps you get there.
This is a general financial article and should not be read as personal financial advice.
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