5 Huge Hurdles to Saving and How to Avoid Them

We all know that it is important to save money, but it can be so easy to tell yourself that you have too many bills to save now or that you will save when you are older. Clichés like “a penny saved is a penny earned” or “every penny counts” can easily make us laugh, but they aren’t completely off the mark. While saving five pennies per month won’t make you rich, saving even $50 per month will give you a nice holiday spending budget at the end of the year.

In addition to saving for expenses like gifts or travel, you need to save for an emergency and also for your retirement. Currently, 44 percent of Americans are living with less than $5,887 in savings (for a family of four). Sixty-eight percent of Americans are not reaching their monthly retirement target, but why is that? There are several challenges that Americans face when trying to save money, and here are just five.

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1. Not being able to afford basic needs

Although some Americans could save and don’t because they just don’t budget well, this isn’t true of everyone. Some people have a job that pays so little that they live paycheck to paycheck and can’t set aside any money for savings because they need all of their income just to cover basic expenses. Americans who fall into this category are often hard-working individuals who can’t keep a consistent job for medical reasons, or they can’t get a job that pays well and would allow them to save.

Even with government assistance, some people can’t afford their basic monthly food, housing, and utilities, so saving for the future becomes out of the question. Even saving for emergencies can be nearly impossible. There is no easy fix for being underemployed or not making enough — hopefully, if you are experiencing hard times, they will be short lived. In the meantime, try to save money wherever you can.

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2. Trying to keep up with the Joneses

Does money make you happy? Well, it depends on whom you ask. Princeton University came out with a study in 2010 that is still often cited today, suggesting that the more money you make — up to $75,000 annually — the happier you will be. After you reach that point, according to the study, you won’t be any happier if you make more money. Seventy-five thousand dollars pays for a lot more in some places than it does in others, so it seems impossible that there could be a magic number.

Still, many people believe that more money and more stuff will make them happy. When you become fascinated with the ways other people are living — whether it’s your friends, coworkers, family members, etc. — you run the risk of becoming too focused on having what they have. You won’t be able to save money if you always have to have the newest car, the best phone, the nicest house. You are better off purchasing items that are nice enough and will last.

3. Thinking you can wait to save until later

You are never too young to start saving. Yes, there will probably be a time in your life when your children are grown, your house is paid off, and so on, but that doesn’t mean you will be able to save more easily then. Emergencies can come at any time, and you are much better off saving as soon as possible. Plus, the sooner you start saving, the better you can capitalize on interest. You also should sign up for a 401(k) as soon as possible, because you will be able to benefit from your employer’s matching program longer. If possible, you should start saving in your 20s, but some rare Americans start saving in their teens.

4. Thinking you’re too old to save

Many people focus on paying off debt when they are young, which is a smart choice if you have high-interest debt. Others get stuck in the idea of living day to day or living in the moment and assume that they will have time to save later. If you are reaching retirement age and you haven’t saved enough, or even if you haven’t started at all, you should still save as much as possible now.

If you are really in trouble, you can try talking to a financial planner, but the truth remains that saving anything is better than saving nothing. A lot of people tout the 52-Week Money Challenge, which can be helpful if you are saving up for a home improvement or other, less expensive project. This challenge won’t help you save enough for retirement, but you could adjust it to help you save for a vacation, car, etc.

5. Believing that prioritizing children makes saving impossible

According to CNN, for a medium-income family to raise a child to 18 years old, it will cost $241,080 (this number is calculated based on children born in 2012). This number multiplies if you have more children, and many Americans find it difficult to pay for food, clothing, daycare costs, healthcare, and educational expenses — and this doesn’t even include college! When you add in saving for the future, some Americans can’t keep up.

Although raising children is extremely expensive and the $241,000 figure for 18 years seems unfathomable, you can still save. Once you pay for all your necessities, try to cut out some of your extras. In 2012, Americans spent $2,605 on entertainment; if you could cut that bill in half, you would have an extra $1,300 per year. Cutting other unnecessary expenses will help you save even more.

There will always be reasons not to save money. Whether your reasons are temporary or long term, make it a priority to save at least a little, even in the hard times.

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