There is a trick to saving money – you actually have to save it. That is to say, you have to deliberately take action to put your money aside.

Many of us try to save money by spending less. That is a good start. However any excess in our bank account at the end of the month somehow mysteriously gets used up next month.

The only way to make sure money you ‘saved’ (by reducing your spending) turns into ‘savings’ is by storing it in a different account. If you don’t, your brain will think there is more to play with next month, even though the larger bank balance is due to the money you want to save.

So if you’ve been finding it hard to save money despite your best intentions, know that it is mental accounting at play.

The solution? Set up a recurring funds transfer. You can easily do so on the bank account which receives your salary in just minutes. You can set it such that a portion of your salary is automatically transferred into a different account, one used only for your savings.

To make doubly sure you don’t end up dipping into your savings account inadvertently, set up your savings account with another bank. Once you’ve automated your savings, you only need to review your arrangement when you receive a raise, or once you’ve hit your savings goal.

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According to the UK’s National Savings and Investment bank, people who had a savings goal saved more money a year than those who do not.

In another finding, researchers found that having multiple savings goals makes you less likely to succeed in meeting any of them. You’ll get stuck deciding which goal you should prioritise.

Taken together, these two findings could explain why you haven’t gotten round to taking the necessary steps to save money. (And being a dashing daredevil who likes to live dangerously has got nothing to do with it.)

Simply put – you aren’t saving because you haven’t set a savings goal. In other words, you haven’t got a reason to save.

Set aside a few minutes to decide on a savings goal – it could be something you want (to see the whales in Antarctica), or simply anything at all (to buy a pet armadillo). The goal is not the point; putting a reason in place so you get started saving money is.

Even if you have nothing you want, (because you attained enlightenment just last Tuesday), try picking a number and saving for saving’s sake. Just don’t make the date by which to attain your goal too far into the future, and don’t set too low a figure.

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Between invoices for electricity, gas and water, to mobile phone, Internet and S&CC bills, there’s a fair amount of paperwork to go through in a month.

Add on bank statements, credit card bills, advertisement flyers, coupons and other assorted junk mail and suddenly that lighter someone left on top of the mailboxes is starting to look particularly shiny.

Setting fire to your bills isn’t the answer, least of all because if you miss a payment, you’ll be slapped with late fees. Worse, the next bill you get might make insinuations about the fallibility of your memory, printed on passive-aggressive pink paper.

Credit card bills and loan payments are particularly serious. Every time you miss a payment you’ll get slapped with late charges of around S$80 – on each credit card or loan. If you happen to be owing several cards, then you’ll find yourself facing a crisis each month.

Or several – different financial institutions have different billing cycles, so there are multiple due-by dates you have to track. At this point, it might be easier directing air traffic. Just writing about it is giving us the sweats already, so that’s clearly not a situation you want to get anywhere near.

Save yourself the hassle. Spend a few minutes to shift your billing cycles onto one easy-to-remember date. You may have to make extra payments to achieve this, but you’ll find it easier to avoid late fees.

In terms of credit cards, if you are heavily in debt, you certainly can’t afford to be missing payments. You also want to reduce your interest payments to get yourself out of debt.

Consider using other financial tools to help you reduce the number of bills and payment cycles you have to track, and slash your interest rates in the process. Depending on how much you owe, a personal loan, a balance transfer, or a debt consolidation plan may be useful.

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