11 Money-Saving Mistakes Making It Harder for You to Get Ahead

Enthusiastic saving is one of the central habits of a healthy financial life and a vital tool for reaching financial freedom. Far from being reserved exclusively for Dickensian villains and stingy bastards, the life-altering power of saving is available to anyone with the right mindset and plan. The only things in our way are the all-too-common money-saving mistakes that doom us to fail before we’ve even begun.

If others have convinced you to believe that you cannot save money, that you should not, or that there’s no point in it, allow me to tell you enthusiastically that they have misled you.

It matters not whether you currently find yourself unable to save anything, are steadily putting away a few dollars here and there, or even if you diligently save 10-20% of your income every month. Wherever you are right now, that’s where we’ll start. 

Everyone has the potential to save a large percentage of their money. Everyone can compound those savings and convert that capital into life-altering wealth. And no one needs any massive windfalls, sacrifices, or special money magic to get there.

With the right mindset, you can save for your future and build a prosperous and thriving life with money. And it starts with challenging these 11 devious money-saving mistakes.

1. Believing That Saving is Only for Cheapskates

Admittedly, saving money has a branding issue. 

What do you picture when you think of a frugal saver? Probably someone like Gary here:

Gary is a grumpy, Scrooge-like curmudgeon. He never leaves the house without a fat stack of coupons, has never once tasted an appetizer, and prefers not to acknowledge that brand-name products exist. He constantly brings up the price of everything and never pays a cent more than his share. Gary loathes gift-giving and refuses to pry so much as a dime from his purse for charity. Plainly put, Gary is no fun.

Here is the joyous news: you don’t have to be like Gary to be a saver. Gary carries an abundance of unhealthy money anxiety. And he chooses to make it everyone else’s problem, too. What I want for you is a relationship with money that is both healthy and joyful. Gary’s is neither.

The best savers in your life probably slip right by, mostly unnoticed, quietly building wealth

The best savers make intentional choices about spending so they don’t have to sweat the small stuff the way Gary does. They know their expenses and work diligently to cut out whatever doesn’t make their lives better. So when it comes to splitting the bill, going out and having fun, and giving freely to others, they can jump in with both feet and keep being awesome.

2. Focusing Too Much on Income

If you’ve ever believed you’d save more money if only you could make more, then you’re not alone. Unfortunately, it’s one of the most common roadblocks out there.

But it’s usually wrong. In reality, one’s income level correlates very little with one’s savings habits. 

People at every income level tend to spend every dollar that comes in and keep themselves financially trapped — even many people with higher incomes, such as doctors, live paycheck-to-paycheck.

It’s easy to tell ourselves that everything we spend on right now is essential, and if we could just get a bit more (like our next raise), then we’d be able to save. But if you’re already in the habit of spending everything you make, then any increase in income will go straight to your spending, not your savings. 

If you are already working hard at developing great savings habits, an income boost can accelerate your path. But no amount of money will create a new savings habit that wasn’t there before.

Excepting only the farthest extremes (i.e., mega-billionaires and those struggling to find the money to survive), income has surprisingly little impact on one’s ability to save. Of course, working on increasing your income creates more potential, but it’s rarely a prerequisite for being able to save. A great saver can set something aside on almost any paycheck.

3. Charging Ahead Without a Goal

One of the most nefarious money-saving mistakes is robbing yourself of the joy of the process itself. Try asking yourself these three questions:

  1. Why am I saving?
  2. How much money will it take?
  3. How quickly can I accumulate it?

If you don’t have a clear and immediate answer to each of these three questions, you are missing the beating heart of your money-saving plan. Like any big pursuit in life, you need to have a deep, burning “why” to keep you going when things get tedious or challenging.

Whether it’s a career change, moving to a new home, starting a business, funding your retirement, or getting out of debt, find the goal that will drive you. Knowing what you are saving for makes the process fun, thrilling, and satisfying. Avoid focusing too much on goals that are mainly just big purchases, like a car or a vacation. These are just another form of spending. They won’t help you achieve financial freedom.

Saving for the sake of saving is a joyless pursuit with no visible reward. Those who try without a clear goal will inevitably fail.

Give yourself something that you can latch onto — something to fight for that will motivate you to push forward. Then, nothing will be able to stop you.

4. Conflating Pleasure with Happiness

The all-too-common defense that arises when we try to cut expenses goes something like this:

“I can’t stop buying those; they make me happy! Why would you try to take that away from me? Do you not want me to be happy? Why do you hate me?!?”

The mistake here is to take the brief, pleasant feeling you get from buying some product or service and confuse it with real, lasting happiness.

This feeling is nice, I’ll give you that, but it is not the same thing as happiness. It’s more like pleasure.

Unfortunately, we quickly adapt to pleasures like these. But then, we return to an empty feeling that we need to fill with new material pleasures. This effect is called hedonic adaptation, which can wreak havoc on our finances.

Happiness, the kind that matters, comes from within. It is a skill we all must practice, and it involves building a healthy relationship with ourselves and the world around us. 

You can live a happy life where you spend very little money and a miserable life where you spend lots of money. Spending and happiness are just not connected in this way. Anyone can learn to create happiness for themselves and others, but the enjoyment from spending money won’t get any of us there.

5. Trying to Force It

Saving is not sustainable when you try to do it despite yourself. This truth is why it’s so important to have a goal, as discussed above.

When you keep trying to force yourself to save money, you reinforce the narrative that saving money isn’t something you want to do. Sure, you may overcome that distaste with brief spurts of determination. But the equilibrium that you will always drift back to is saving nothing at all.

The great news is you don’t have to force yourself to save money. Instead, one of the most crucial shifts in becoming an excellent saver is to find joy in it!

Envision yourself achieving your next big money goal and how much easier your life will be. Then, imagine what you will be able to accomplish after that. Relish in the joy of finally taking charge of your spending and becoming an effective CEO of the business of your life. Enjoy paying yourself for once instead of everybody else. 

If you’re still trying to force yourself to save money, you probably haven’t figured out how to enjoy saving yet. And if you don’t find your way to the thrill of this journey, you will never succeed. So stop forcing yourself to save money, and allow yourself to love it for how delightful it can be.

6. Buying for Price Rather Than Value

Here’s a thought exercise: there are two coats for sale. One costs $40 and the other $75. So which one does the frugal shopper buy?

The answer is: neither, necessarily. 

This setup doesn’t offer enough information to make the best choice because this setup tells us only the coats’ prices — wise pending decisions factor in value, not just price

Sometimes a cheaper option is less effective at its purpose and will wear out quickly and need to be replaced, costing more in the long run. Sometimes one option is twice the cost of an identical item and does nothing but put a fancy label on it. Neither is necessarily the right choice on price alone. 

The key is searching for balance between value and price — or, ideally, imbalance that leans toward higher value for a lower price. Before making a decision, ask questions like:

  • Why is this one more expensive?
  • Will this one be more sturdy or reliable?
  • Which will it do the job better?
  • Which will last longer?
  • Does one feel better in my hands or call out to me as the right one?
  • Is the price difference worth what this one offers?

Always buying the cheapest option could cost you a great deal in the long run. But, likewise, only ever purchasing the top-shelf option is equally reckless.

And, of course, you can never save more money on something than by not buying it in the first place. (A good saver always starts by asking: Do I even need to buy this right now?) But if you’ve decided to buy, then buy for value, not price alone.

7. Corrupting the Word “Investment”

In a financial sense, an investment is something you put your money into to gain a profit. It’s something that everyone worth listening to agrees is a good thing to do with your money. 

But here’s the rub. The word “investment” becomes dangerous when we hijack its positive, financially prudent association and use it to justify unnecessary spending. For example:

  • “Got my bonus check this week. I’m going to invest it in a new car!”
  • “You really should invest in some new fall outfits.”
  • “This TV was a great investment.”

None of these is an investment. These are purchases. They may even have been worthwhile purchases that bring you enjoyment.

The point is not that you should never buy these things; most of us will do so occasionally. The point is not to delude yourself that these purchases will benefit you financially.

Confusing “spending you’re proud of” with “good financial health” is a dangerous mix-up.

You may have gotten that TV at a great deal, and you may love it. If you’re happy with the purchase, I’m glad for you. But I can also say that it is not an investment and is not helping you build your financial future.

8. Using the Word “Sacrifice”

Another word that tends to get all twisted up in our money-saving misconceptions is the word sacrifice.

Recall from above that forcing yourself to save money won’t keep you there for long. You may be able to pull it off in short sprints, but not forever.

Far too many people think of saving as sacrificing the things they love to reach a goal. Like they are nobly enduring today’s suffering to create tomorrow’s paradise. This attitude, while seemingly encouraging, can hold a person back from long-term saving.

To sacrifice is to give up something you hold dear and will sorely miss, to serve some greater purpose. But, my Dudes: that’s not what healthy saving is. Like, at all.

Saving is about finding the expenses that aren’t making your life any better and getting rid of them. It takes some practice to get the right feel for it, but once you get your savings machine going, you’ll notice that you rarely (if ever) miss the things you stop spending on. And what’s more, you’ll now have a growing pile of capital moving you towards an easier, freer, more peaceful life. By saving, you are giving to yourself, not sacrificing from yourself.

9. Letting Other People Tell You What to Do With Your Money

Most people you talk to have big ideas about what you should do with your money. The more you listen, the more you’ll hear it. And spoiler alert: most of those ideas are bad for your financial health.

Recognizing when other people are telling you what to do with your money, understanding why they are doing so, and making your own decisions can be a lifesaver on your financial journey.

Understanding motive and intent is critical.

For instance, it’s pretty easy to spot a salesperson “advising” you to buy their most expensive product. But, of course, if you’re trying to save money, your goal is the exact opposite of theirs. So we usually know to eye their words with caution.

But a sneakier one to watch out for is friends and family who suggest what you should buy or where you should put your money. As often as not, they just recommend something they did, and they subconsciously want to feel validated by convincing others to do the same.

Most people (myself included) who suggest what you should do with your money honestly intend to help improve your life. But it is your responsibility to consider where that person is coming from and process what they suggest, not just their confidence and enthusiasm. It will always be your job to decide for yourself what is best for you and your situation.

10. Under-Appreciating What You Have

Not appreciating what you have sucks money straight out the window.

Generations of leaps forward in the humans’ ability to manufacture new stuff quickly and cheaply, while very exciting from a futurist’s point of view, have led to an outbreak of consumerism and throwaway culture.

When was the last time you threw something out (something you had paid money for) because it wasn’t working quite right, a newer version came out, or you simply got tired of it?

The luxury of tossing something aside and immediately replacing it is a very modern one. Unfortunately, it’s also exceptionally harmful to intentional spending. It reinforces the detrimental habit of constantly buying, regardless of want or need. We end up caught in a loop – always buying and never feeling satisfied.

Fortunately, there are several steps you can take to ameliorate this problem:

  • Buy for value rather than price (see #6) – Focus on things you love more that will last longer.
  • Think like a minimalist – Get rid of things you don’t care for, and don’t replace them. Focus your attention on the things you love most.
  • If it is broke, do fix it – Simple repairs on damaged items can give them new life with added character and help you love them more than ever, as in the Japanese art of kintsugi.

Throwaway culture drains your wallet, precludes happiness, and hurts your stuff’s feelings. Don’t be mean to your stuff. Instead, learn to love it better, find yourself happier, and save more money than ever.

11. Choosing a Pessimistic Outlook

The biggest money-saving mistake of all is not believing in its potential.

A profoundly pessimistic cultural conversation around money has led far too many of us to believe that:

  1. A regular person can’t save money and still make ends meet.
  2. Saving what little we can never help us get ahead.

I am pleased to inform you that these statements are both wrong, but only if you can accept the alternative. 

If you tell yourself that there’s no way for you to save money, you will be correct. But if you tell yourself that there are many ways to save money that you haven’t discovered yet, you will be right about that also.

And once you start building a foundation with your savings, you will discover means of using that platform to create wealth like you never before thought possible.

A positive attitude is everything when it comes to money. There is so much that we can all do to find and plug the leaks in our budget, start saving, and then keep saving to momentous effect. With time, these gains compound and snowball, building a near-unstoppable wealth-building machine. So long as you believe that there are greater possibilities for you and your money, there will be, and you will find them.

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Hey, I’m Sam. I created Smarter and Harder to explore big ideas, both old and new, about building a better life. My mission is to evolve the conversation about personal growth and have fun doing it.

3 thoughts on “11 Money-Saving Mistakes Making It Harder for You to Get Ahead”

  1. This is such an informative post and one I think everyone should read! You’ve really highlighted why, IMHO, couples need to have the same values about money and financial management. Thanks for sharing!


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