The New York Times recently ran a series of six essays offering various explanations for the generally poor job we Americans do with savings.

One blamed the disappearance of defined benefits plans, which, without any conscious effort on the part of workers, provided a steady income in retirement.  That same writer dismissed the efforts of “self-help” writers, stating that figuring out a budget “requires me to lead a charmed life and not have any kids.”  Huh?

Another blamed stagnant wages and the appearance of “many new attractive goods and services, including iPads,” noting, “it’s hard to save money under those circumstances.”  Right.  Who could possibly find the willpower to save with all those shiny baubles staring them in the face?

A third said, “Living beyond one’s means is a deeply ingrained American habit.”  His solution? “Prudent lenders” who would “restrain the exuberance of borrowers.”

And on they went, encouraging readers to look everywhere and anywhere for a scapegoat – anywhere but in the mirror.

Own It

Please don’t shoot the messenger – I really don’t mean to be harsh, and I fully get it that some people are in far too bad a financial condition to be able to save – but I believe there’s something to be said for taking personal responsibility.  And I believe there are many people who think they can’t save who actually could save.

Whenever I teach a workshop on getting out of debt, I ask participants to fill out an anonymous survey that asks, among other things, how they got into debt.  They can check more than one answer.

Many participants note horrendous circumstances they’ve faced – divorce, extended unemployment, catastrophic medical bills.  Interestingly enough, though, over half usually also check the box, “Lived beyond my means.”  Those are the people for which I have the greatest hope.  The fact that they were willing to own at least part of the responsibility for their situation gives them the best chance of getting and staying out of debt.

Do It

If you feel like it’s impossible to save, let me offer a few suggestions.

Make savings a priority. A key to wise money management has to do with financial priorities.  Give a portion of all income you receive, then save or invest a portion, and then build your lifestyle on what remains.

I’ve met people who’ve done crazy things in order to be able to give and save or invest before spending on their lifestyle.  One couple somehow gets by without Internet service at home.  Others have gone from two cars to one.  And you know what’s really crazy?  They’re experiencing financial sanity.

Make savings a habit. As I wrote in The Case Against Frugality, during the worst days of the recession, many people were convinced that they had forever changed their financial ways.  They were ditching debt, building savings.  But with the first hints (or is it a tease?) that the economy is improving, debt is headed north again, savings is going south.

This happens with the stunning predictability of our seven-year-old waking up at 6:30 every morning.  The economy revs up, people spend it up.  The economy slows down, people dial back on their spending.

Wouldn’t it be so much better if we didn’t practice such financial binging and purging? What if we always gave and saved or invested with the first dollars of our income and then spent on lifestyle?

Make savings automatic. If we only have to decide to save once – the time when we set up an automatic deposit or transfer into savings every month – it’s a lot easier to save.

Make savings less taxing. The average federal income tax refund this year is over $3,000.  Every year at this time, the press is filled with the same stories.  What will you do with your refund?  We’ll save it, people say, or use it to pay down debt.  But then come the stories of big-screen TV sales spiking at about the same time as income tax refund season.

I usually recommend that anyone who gets a big refund every year change their withholding so they stop giving Uncle Sam free loans, and then use that added monthly income to save.  But even if people prefer the big refund, what if they put the whole amount into savings?  And what if they did that every year?  It wouldn’t be that long before they achieved something remarkably good and rare: an emergency fund of six months’ worth of living expenses.

Make savings emotional. This may be the most important step of all.  All successful advertising makes an emotional connection between us and the brand or product.  I just saw a billboard promoting a new Chevy Camaro that said, “You don’t park it, you display it.”

Put that up against this slogan: “Put money in savings.  It’s the right thing to do.”  The Camaro ad speaks to the heart.  The savings slogan speaks to no one.

We need a compelling, emotionally charged reason to save.

What if we connected savings to better health or better relationships?  What if we knew in our hearts that putting $200 into savings each month would dial down the stress in our marriage?  Add some joy?  Wouldn’t that shine brighter than the latest must-have electronic item?

How are you doing on the savings front?  What’s holding you back?

March 8, 2011

Matt Bell is the author of three personal finance books published by NavPress, including the brand new "Money & Marriage: A Complete Guide for Engaged and Newly Married Couples."  He teaches a wide variety of workshops, including MoneySmart Marriage, at churches, conferences, universities, and other venues throughout the country.  To learn more about his work and subscribe to his blog, go to: www.mattaboutmoney.com.