5 Reasons your savings account has a zero balance

So you opened a savings account immediately you got that dream job five years ago and you have been putting money into the account religiously, so why do you keep getting a statement that shows that you barely have anything but crumbs in your savings account when the bank isn’t stealing from you? The answer is because you are probably saving your coins in a piggy bank that has a huge hole at the bottom!

Here are some reasons why your savings account makes it seem as if you have been storing water in a basket:

You started too late: People who delay saving till they get their ‘dream job’ are more likely to put off saving for ever because the ‘dream job’ may just be an illussion, even when they do save, they eat up their savings without thinking too hard about it. The truth is that if you cannot save when you earn $100, you reduce your chances of doing so when you earn $100,000. So start small and start early.

Lack of self discipline: Your biggest barrier to maintaining healthy cash reserves for the rainy day is your own self. Your ability to prioritize, delay self gratification and most importantly separate your wants from your actual needs can make or mar you financially. So make sure you think about expenses carefully before making them otherwise you will continually struggle to keep up with your bills with nothing extra to save. Expenses that need to be funded from cash in your savings account require extra and more careful consideration on your part.

Savings is not included in your budget: You should try to maintain a personal budget no matter how much or how little you earn, and savings must be a prominent line item on that budget just like your other bills such as rent, car expenses etc. The first and most important person that should be paid every month should be yourself, afterall you are the one who works for the income, the best way to pay yourself first is to save for the rainy day.

Debts: How can you maintain your savings when you owe far more than you own? Keeping money in your savings accounts when creditors keep knocking on your door is almost impossible. Although there are unfortunate life events that cause some good people to be in huge debts, many of us land in hot water because of our inability to maintain self discipline (as discussed above). So you need to pay attention to this and cut your coats according to the size of your fabric.

No ‘savings controls’: When it comes to money, we need to understand that all of us have the ability to stray far from our goals, therefore it is important to establish strong savings controls. Savings controls are those conditions that force you to save. Examples include: establishment of payroll direct deposit for the desired savings amount, maintaining a savings account in a separate bank apart from the one you frequent, and keeping your savings bank card and account access documents at home instead of in your wallet so you don’t have ready access to it during your moment of weakness.

So how much should you save every month?
How much you save depends on many factors including your income level, monthly obligations, future aspirations and plans (e.g. Entrepreneurship plans, retirement, marriage), age, family structure etc. However, once you have established the optimal amount you need to save, ensure that you are consistent and diligent. Also ensure that you pass any extra income or windfall through your savings account while you are making a decision on the best way to spend it.

I hope these tips help you plug the hole at the bottom of your piggy bank!


Published by Tope Ganiyah Fajingbesi

I am a CPA and an International Chartered Accountant with 15 years accounting and financial management experience from big 4 accounting, fortune 500 and nonprofit organizations within the United States of America and Africa. I am also a writer and love to help others live the best financial life possible.

One thought on “5 Reasons your savings account has a zero balance

  1. I save at least $50 per month. From 150$ of my earnings, I can easily go through the next payment date with only $100 easily. But now a days, It’s becoming tough for me to do so.
    So, i’m gonna discuss this matter with my financial coach.
    The article was helpful though.

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