We all know about the importance of setting and striving for specific goals in our lives, but frequently it's harder to do than we thought. We all know the basic tenets of budgeting and saving, but putting them into effective practice can sometimes come to nothing. We talk to Amy, who has just built her own home and now needs to 'restructure her savings to fit her young family's needs. She discusses the obstacles she faces and hears from two experts on how?to stay on track and achieve your goals without losing sight of what matters.
35, sales manager, mother of one, just built her dream home
When my husband and I decided to build our family home four years ago, we became very dedicated savers. We finally moved in with our young son in 2014 and now that the our largest financial burden is settled, we're starting to look toward smaller financial savings goals, like improving upon our pension, buying a car and putting money aside for a family holiday.
We keep our accounts separate so I pay the mortgage and my husband pays the childcare and then we split the household bills. We do have an emergency fund but it constantly gets eaten into.
My biggest concern is that since we moved in I have been less dedicated in putting regular money into savings. During my twenties I was a terrible saver and just lived month to month, it was only when we made the decision to buy a site that the reality set in and I put some serious focus on where my earnings were going. I hope I don't fall back into old habits. It's also complicated by the fact that I work in sales and receive a (hopefully!) large lump sum as a commission every six months, which is difficult to bank when I've already started dipping into my overdraft! I need to find a balance between continuing to save for smaller things while being able to enjoy my earnings.
Our pensions are also starting to come into focus. We both have private pensions but reduced the amount being paid into it when we were building the house and I was on maternity leave because everything was so tight. However, we haven't increased it since and I'm struggling to coax myself back into that frugal mind-set.
The Experts Advice...
Sinead Ryan and Shalini Sinha. Photo: Al Higgins
Sinead Ryan, Personal Finance Expert says?
Just because your current savings goals are a smaller task than a home doesn't make them any less important. Why not create dedicated savings fund for each - a car, a holiday and an emergency fund - and put money into these at the beginning of every month. You will be less likely to dip into them for other reasons and as you become a more active saver, you won't need your commission to dig you out of your overdraft. An overdraft is like a mini-loan with a huge interest rate, if you had to go into a bank and apply for it would you still need it?
Your pension is also a crucial thing to keep an eye on, even if it's thirty years down the line. A pension fund is tax-free so for every €100 you put in, it's really only costing you half that.
Shalini Sinha, Life Coach says?
We truly are our own biggest critics. You've already saved so much, have a little faith in yourself! We tend to set our personal goals so high that they are impossible to achieve, resulting in feelings of failure and a lack of motivation to continue. You obviously have a number of things you want to channel your finances into but rather than demand that you focus on them all equally and to your full capacity, reign in your expectations. Put a minimum value on what you'd like to put away. Once you've done that you can feel as though you've achieved something and if you manage to put any more away it'll feel like a bonus.
Be as kind and as patient with yourself as you would be to others, you're doing the best you can.
To find out more about setting up a savings account with the savings specialists, RaboDirect visit RaboDirect.ie or call 1850 882 244
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