Monday Morning
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Monday Morning

The psychology behind saving money / How to trick your brain into saving mode?

Haven’t we all said that we are going to save money, yet we fail to do so, because fuck it, it won’t make a difference anyway. The struggle to save comes from the fact that it requires us to look so far into the future, by idealizing unknown circumstances. That is a difficult job for our brains, as it must comprehend what the future holds. The brain knows we don’t know what the future holds. Therefore, it passes the saving aspect to the side and doesn’t prioritize it. Saving for the future requires our brain to plan and think ahead for much longer than we are used to. Society doesn’t help either, everything is fast paced, nothing can take too long, otherwise it is not worth it. In essence, it is the vagueness that the brain doesn’t like and the fact that we are trying to catch something we don’t even know exist.

However, you can trick your brain to think differently about saving money. That is by making the calculations how much money you would have if you saved X amount of dollars for X years, plus adding the interest or profit. This not only gives you the number for your brain, but it also shows you that saving really does make a difference to your life. We don’t even comprehend how much power longevity and regular saving has unless you make the calculations and see the progress in front of your eyes. So, get down to numbers, make your calculations and based on how much you can save today, I would also recommend you increase the amount every year with a certain percentage. Get specific, your brain enjoys that much more, than just saving for the unknown future. For example, if you know, that by saving 500 dollars a month, for 30 years, you will have 1,139 662,66 dollars (with an average 10% yield). This is a wakeup call for your brain, it realizes that this is a real target, an achievable target, and the focus shifts from side to the center. That is because we know where we are going and exactly what we are trying to achieve. By the way, if you were to save the same amount of money under your mattress, then you would have 180 000 dollars in 30 years. Quite a difference, isn’t it?

Shock your brain with numbers, give it a target to chase, and you see how differently you start to feel about regular saving.

Saving is a straightforward subject in theory, save regularly over a long period of time. No science to it. So, it is not the saving itself that is difficult, it is our fucking brain, that is unable to comprehend that we need money in the future too, not only today.

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