Spender or Saver? - It's all about balance
Spender or Saver? - It's all about balance
In addition to boosting your savings, an automatic savings plan can help you with budgeting and managing spending habits, as you can't spend money that has already been transferred
Greetings!
Our conceptions about Money management is not something that is inborn in us from birth. Rather our beliefs, feelings/mindset around money are often shaped at a young age by our individual life experiences (e.g., passed down from our parents or influenced by our current situations) and when we start to have an understanding of the value of money and our perception of whether it is plentiful or scarce. Money and financial planning are logical topics that are known to have very deep and emotional roots that can significantly impact relationships, even all those years later.
Though feelings around money tend to exist on a spectrum, at the core there are two main, more broad categories we fall into – spenders and savers. A common misconception is that being a saver is the “right” way to be, and often causes those who exhibit more spender tendencies to feel guilt or shame. The truth is that it’s genuinely dependent on a person’s circumstances, finances, and goals. There is no true “right” way, and the proper balance of these two mindsets lies somewhere in the middle and is a little different for everyone.
Let's delve a little deeper to give more insight into who or what are Spenders or Savers.
Who is a Saver?
A saver is, in short, a person who thinks ahead to the future. While they can live and enjoy the moment, when it comes to money, they’re always thinking about how they can stretch it to last as long as possible. An excellent way to describe them is that they’re always looking towards the horizon.
Overall, a saver is someone who is excellent with budgeting, as well as living within their means. If you were ever going on a group vacation, you would want to put a saver in charge of the money because he or she is going to make sure that you’ll stay within your budget while having a good time.
Who is a spender?
On the opposite end of the spectrum, we have spenders. Unlike savers, they are more concerned about living in the moment, not necessarily planning for the future. While most spenders are not out of control with their habits, they value what’s happening now over what’s going to happen tomorrow.
In our group vacation scenario, you may not want to put a spender in charge of the budget. Yes, you’ll have a great time and do some incredible things, but you may have to cut your vacation short because you ran out of funds too fast.
Spenders are usually more outgoing and see money as a means to an end. I’m buying this thing because I want it. I’m going out to eat because I’m craving this type of food. Instead of seeing the intrinsic value of money, they think about it concerning what it can be used for.
Overall, spenders are not that great with budgeting, but they are fun to hang out with. At the bar, they’re more concerned with the great feeling that comes from buying drinks for their friends than they are with the bill that’s going to come at the end.
Come to think of it, this reminds me of a story of two brothers, Taiwo and Kehinde, obviously twins and their financial lifestyles.
Both were raised in an average home by frugal parents who operated a low-spending financial system and also instilled in the boys the importance of saving money, spending wisely, and budgeting.
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The Teen/Adult years
As the boys grew, so did their social lives. Taiwo, now 17yrs, an undergraduate earning a reasonable amount working part-time when school is in session and full-time when not, loves to spend his weekends with friends going to parties, eating out at restaurants, and shopping at the mall using his spending money, and because he had saved 10% and tithed same 10% as counselled by his parents, he felt no guilt in spending the rest. Taiwo was not by any chance a 'lau lau' spender (spending money lavishly). So at his graduation from University, he was proud of what he had in the bank, a respectable savings of ₦750,000.
Kehinde on the other hand, is 17 yrs and an undergraduate, also earning a reasonable salary working part-time when school is in session and full-time when not has a different approach to his social life, he chose his friends wisely, friends that had similar goals and aspirations as him. Now, instead of saving 10% of his earnings and paying his tithe as his parents advised, he opted to be more frugal, saving as much as 70% while still paying his tithe. At graduation, Kehinde was able to save up ₦3 million.
So What Happened?
Two brothers. Born the same day. Raised the same way. Worked at the same job, and received the same paychecks. Yet, Kehinde ended up with four times the amount of money that Taiwo had.
The difference?
Kehinde was much wiser in his spending. He chose to participate in frugal activities and understood the value of saving as much money as he could.
Taiwo, on the other hand, did the bare minimum. He didn’t worry much about the future and figured as long as he was saving a little bit, he would be fine. Taiwo didn’t realize the life he COULD have given himself if he had only practised a little more self-control. His vision was not as big as Kehindes.
Spending Habits Matter
All good stories end with a moral, and this one is no different.
The story of Taiwo and Kehinde has taught me many many financial lessons. However, there is one lesson that sticks out to me more than the others.
Taiwo and Kehinde received the EXACT same paychecks, for the EXACT same number of years. Their parents taught them the EXACT same money principles in the EXACT same way. But, Kehinde chose to save and save and save, while Taiwo chose to spend.
This teaches me that our financial situation is not always about how much money we might MAKE….it is more about how much money we SAVE. The paycheck isn’t the problem, the way we spend money is the problem.
Just imagine what a difference your savings account could make over the next few years if you just cut out going out to eat, or going to the movies, etc. Little baby steps can make a big difference.
Taking control of financial habits is not an overnight process, but with dedication and perseverance, you can turn spending tendencies into disciplined saving practices and thanks to technology, the process can be easier. Ever heard of an automatic savings plan?
What Is an Automatic Savings Plan?
An automatic savings plan is a type of personal savings system in which the plan contributor automatically deposits a fixed amount of funds at specified intervals into their account. The typical structure of this type is an automatic transfer from an individual's bank account into a savings or investment account every two weeks or even every time one spends money.
Every time the individual receives a paycheck from their employer, or he or she is self-employed, once the is transferred into his account a designated amount is automatically transferred into the individual's savings account.
For a very effective and efficient way to practise automatic savings, use the Moor Pay App. The app has been tailor-made to take care of all your savings needs with flexible plans that match your personality. In addition to that with our save+spend feature, you can equally still spend and know that automatically a percentage of what you spend is saved for you.
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Key Takeaways
With an automatic savings plan, the saver arranges for a specified portion of their paycheck or income to be automatically deposited into a bank account on a periodic basis.
This kind of savings plan is convenient for someone who wants to steadily build up their savings without having to manually deposit funds every few weeks.
In addition to boosting your savings, an automatic savings plan can help you with budgeting and managing spending habits, as you can't spend money that has already been transferred into a separate account.
To set up a plan, using the Moor Pay App, use this link to download the app and navigate your way to our savings platform or better still you can contact our customer care personnel. Send me an email at o@zaidi.com.ng or SMS/WhatsApp - 0916 217 1134. And I will respond as fast as possible.
I conclude with this, there's no better time to start saving than now. So quit procrastinating and begin your savings journey which has been simplified using the Moor Pay App.
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Dafe from Moor Pay
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