Published at: 5/11/2017 1:58:25 PM
Chances are, while you’re reading this you’re also re-potting a plant, planning tonight’s dinner menu and possibly staining the back deck. Not to mention checking your social media. Multi-tasking is what we do these days. But is it the best approach?
Psychologists say less can be more when it comes to making sound decisions. Apparently our brains aren’t really hardwired to complete different tasks simultaneously. (Which is why you might occasionally catch yourself doing something like putting a cup of tea in the fridge.)
What does this mean for your finances? If you’re going to focus on multiple saving goals at the same time, you need a strategy to deal with the downsides of multi-tasking.
Men and women tend to approach saving very differently. It turns out women tend to save for a number of different goals all at the same time, while men have laser-like accuracy, focusing on a single savings goal.
Which is the better approach is open to debate, but it’s clear that money multi-tasking has its challenges. There’s only so much we can get done at a time, and overloading yourself with too many short-term goals can just lead to stress.
But if focusing on multiple financial goals is your thing, you might as well do it right – making full use of the tools available to maximise your savings and minimise your tension.
Saving to achieve different goals can be as easy as setting up ‘savings buckets’ – using different types of accounts to achieve a range of personal goals. Look for fee-free accounts to be sure your progress isn’t hampered by unwanted charges.
Instead of juggling different deposits each week, give your brain a break. Decide the priorities of your savings goal, then allocate funds on a sliding scale to each savings bucket – with more going into the account that represents your most important goal, and working your way down the list across less urgent goals.
Then set up an automatic online transfer of funds to each account with amounts that reflects your order of priorities. Time your transfers to coincide with pay days, so you don’t overdraw your everyday account.
This type of money multi-tasking is an easy way to save for a holiday, new furnishings and maybe even home renovations, all at the same time. It’s all about making efficient use of your time as well as your money. And it’s a no-brainer to use the technology of online payment systems.
Money multi-tasking? With some planning and a clever strategy, it’s something we can all nail.