8 Signs Your Savings Habits are Seriously Unhealthy

Harmful spending habits can be easy to point out, but unhealthy savings habits can often be a bit trickier to discern. Overall, the key to having a healthy relationship with money is finding balance. Because striking that balance between saving responsibly and avoiding self-deprivation can be precarious, a solid amount of self-evaluation is necessary for ensuring that your financial health is in top shape. Here are 8 ways to know your savings habits are not the healthiest. 

1. You never treat yourself.

If you have money in your savings account and more than enough to pay your bills but still avoid spending money on nice things for yourself now and then, that’s a sign that your saving is compulsive. While money doesn’t buy happiness, studies have shown that investing in time-saving purchases can up your happiness score. Saving money is important, but so is enjoying life.

2. You aren’t working toward paying off debts.

Contributing money into your savings account is important. But if you aren’t actively trying to pay off your debts, you’re allowing money to be stolen from your savings thanks to the interest that accumulates over time. While having a large sum of money in your account may look and feel good, if you aren’t contributing money to pay off an existing debt, you will just end up spending more money in the long run.

3. You don’t have a specific financial goal in mind.

Like many things in life, to pick up traction, you need a solid stopping place. If you just plan on putting aside amounts of money indiscriminately, you will never know how far you’ve come. Whether you’re saving up for a nice vacation or are beefing up a rainy day fund, knowing the exact amount that you want to save helps keep you on track. If you feel like you’re just throwing money into the ether for no reason, saving is going to be that much more difficult.

4. You often dip into your savings.

Putting money in a savings account isn’t doing you any good if you find yourself often dipping into the account. If you find that you’re treating your savings account more like a checking account, you might need to reduce the amount of money you’re allocating to your savings to make sure that you have enough staying in your main account.

5. You don’t pay yourself first.

One common mistake many people make is only adding what money they have left over after buying everything else to their savings account. Making a budget and sticking with it is important. But if you aren’t setting aside money for savings first, you aren’t working as hard toward reaching future financial goals as you could be.

7. You aren’t making the most of your money.

Traditional banks typically don’t offer the highest interest rates. Putting your money into a high-yield savings account will allow you to earn money just by having it there. Letting money sit in an account around collecting dust when it could be collecting more money means you’re doing yourself a disservice. Maximize your savings by taking advantage of a high-yield savings account that will let you earn interest either provided by your bank or through an online service.

8. You don’t set benchmarks.

Establishing benchmarks is an essential way to make sure that you see the progress that you’re making toward your goal. You should check how often you’re meeting smaller goals that will ultimately result in your bigger goal. Pat yourself on the back when you cross a new threshold, and you’ll be continually inspired to keep yourself on track. 

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Kayla Heisler is an essayist and Pushcart Prize-nominated poet. She is a contributing writer for Color My Bubble. Her work appears in New York's Best Emerging Poets anthology.