There's nothing worse than going on a diet and actually gaining weight. Except for flying monkeys; they'll haunt your dreams. But right up there is finally making the commitment to save money, sticking to a new, tough budget, and tracking every penny… only to discover that the savings aren’t piling up as you expected.
According to Cameron Huddleston, the Life & Money columnist at GoBankingRates.com: If your new budget is making you broke, you're doing it wrong. Cameron has identified some common mistakes that might be sabotaging your newfound fiscal discipline. The List's Jimmy Rhoades with more... Now on The List!
MAKING THE PERFECT THE ENEMY OF THE GOOD
Ever find a good deal, and NOT pull the trigger because you want to find the amazing rainbow unicorn of deals? According to Cameron, you risk ultimately paying more. "This is going to be especially true of travel. You spend too much time looking for the best deal on a flight, those flights fill up quickly, and then suddenly you're stuck paying more than you would have if you just booked a very good deal instead of trying to find the very best deal."
Instead of looking for chunks of dollars, you might be spending too much energy pinching pennies. As Cameron says, "The lattes, the bottled water, the lunches out... but really the payoff would be a lot bigger if they focused on those big, recurring expenses." So shop your auto insurance, consider cutting the cord on cable, and make sure you're not paying for data you're not using – changes that can save you hundreds or even thousands of dollars a year.
WASTING MONEY SAVING MONEY
This might sound confusing, but Cameron explains: "You use an app to find the cheapest gas station in town, and then you drive several miles to get there. Or if you're going to several grocery stores to get the best deal at each grocery store, again, you're driving, you're using gas"...and spending all the money you think you're saving.
YOU SPEND WHAT YOU SAVE
Finally, Cameron suggests that if you're going to work hard to find deals and streamline your spending, squirrel that money away so it can grow! "For example, if you lower your insurance bill, by thirty dollars a month, set up a direct transfer from your checking account into another account so that thirty dollars comes out automatically, you don't even have a chance to spend it."
If you're smart about saving you can afford the little things that help you enjoy life. And isn't that the point?