Saving money is trendy again

I recently read a magazine article talking about how the recession has brought saving money back into style as people found themselves short on disposable income and easy credit. The article went on to explain that part of the “new” saving trend was buying more expensive clothes that don’t wear out quickly, and I agree in principle, but would steer clear of “name brands” found in many magazines advertising sport watches in excess of $300. While the article had some great info, it felt like they were mostly trying to sell overpriced goods and convince customers they deserved a pat on the back for “saving money.”

What really captured my attention was the article’s focus on how this saving trend was “new”, “fresh”, “exciting”, and not “cheap” like saving money has been viewed in the past. Apparently people believe that for any idea to be good, it has to be new. Saving money has never meant “cheap,” and there is nothing wrong with saving… however one may view it.

Saving money is virtuous and logical

Saving is a synonym of the word frugal which comes from the Latin root frugalis and is closely related to the words for both fruit and enjoyment. Nothing cheap about those terms! Saving money was actually one of the old Roman Virtues, and in times past was also an American virtue. Somehow, over time, the modern American virtue regarding money has been closer to irresponsible spending than saving. For many years in America it seemed anyone who paused to think before spending was quickly characterized as a penny-pinching cheapskate. Thankfully, that trend has reversed again due mostly to the recent financial crisis.

While not buying stuff you cannot afford is part of of what it means to be a saver, it is only half the meaning.

Webster tells us that saving money is about economy and the use of one’s resources. A mindset of saving will often lead you to avoid spending even if you have the money saved, perhaps because you are saving for something else or you just feel the purchase would not be worth your life energy. The essence of saving is simply spending less than is necessary to get what you want, which is hard to do if we are unaware of exactly what we want. As strange as that may sound, most people never set savings goals for themselves. Have you set savings goals for yourself? What are they?

Saving money for specific goals helps you avoid pitfalls

What do you really want in exchange for your life energy? I’m not referring to the general stuff like food, a roof, some wheels, and a few vacations… I’m more interested in the specifics. Where exactly do you want to live and in what type of home? What toys do you want most? What is most important to you in a vehicle? Where do you want to go on vacation and when? Do you want to retire and at what standard of living? No one can have everything, so we all must decide which things we want most. If you never ask yourself such questions, there are a couple of financial pitfalls we tend to run into.

First, without focus on what we really want we tend to buy whatever we see… simply because buying new stuff is fun. We might even buy good stuff, but if it is not what we really wanted, it runs the risk of sitting unused and the life energy we spent to attain the stuff gets wasted. Without specific savings goals our resources may get unnecessarily consumed, and we eventually miss out on something we would have enjoyed more. That is not very wise, but most of us have done it more than once… myself included! 🙂

Another common pitfall… not saving as much as we could have had we set specific savings goals. Without specific financial goals we become comfortable with the status quo. If our bills are paid and we have some savings… we may never think to save more. Absent any definitive goals (and the sacrifice necessary to reach them) it is much easier for careless spending to rob us of the things we actually wanted the most but never took the time to define. The difference between deprivation and sacrifice has been described as the presence of the goal which a sacrifice is made to attain. Visualizing the purpose of your sacrifice will give you the strength to see it through, to save for it, and is likely to make others wonder how you are able to accomplish so much with the amount of money you earn.

I’m bringing saving back

Finance writer Joe Dominguez looked forward to a time when we would speak of savers with awe and respect (hey, he was writing in the 70’s.) I think now is the perfect time to bring back the saving trend, but without the $300 watches the magazines are pushing! 🙂 People focused on saving money are typically willing to make sacrifices to meet specific goals. I set a high goal to save $22,000 towards a house this year. For me it is attainable, but requires having to say no to some of the fun things we like to do. My wife and I stick with it knowing that every penny we save brings us that much closer to the house we both want.

Are you bringing saving back?

Have you made a list of which things you want most, and thought about what things might be getting in the way? Where could you save more and what sacrifices could you make for the things that matter most to you and the things that will help you meet your savings goals without feeling deprived? We would love to hear about any goals you have set for yourself, or that you have recently achieved.