As a personal finance advisor, I can only show my clients the cold, hard realities of their financial lives and give them strategies for improvement; but until they are ready to make the necessary changes, I really can’t help them become financially successful.

After learning the secrets of managing, multiplying and maintaining money, it became my mission to pass on the good news to all. At first I was naïve in believing that once people understood how to transform their finances, they would quickly adopt key principles such as budgeting, saving and debt management.

Very soon I realised that it would not be quite that easy to influence some people’s personal finance habits. Even if they recognised that their negative practices would lead to their financial ruin, it was often difficult for them to change bad habits and do things differently.

Some people remain in financial challenges because they are quick to offer reasons why suggested solutions to their problems can’t possibly work. The need to save regularly is an area that is particularly prone to imaginative excuse-making. Here are some common excuses:

I Don’t Earn Enough Money To Save

Many people think that a little bit of money can’t make a difference, so why even bother? This flawed idea has prevented many people from saving whatever amount they could find. The essence of saving is that it creates the discipline to delay gratification, and focuses you on accumulating money instead of just spending it. The actual amount you save is irrelevant to attain this objective.

If you put aside $50JMD every day, after 30 days you would have $1,500JMD. If you save that amount in a money market account and earn a net return of five per cent per annum over the next five years, you will have built up over $100,000JMD. You probably spend $50JMD on unnecessary things every day – why not save it instead?

I Earn Enough Money; I Don’t Need To Save

Whereas I can understand someone not knowing that a little amount can multiply over time, it’s hard to fathom people who think that their earning power will continue to meet their needs forever. What about putting aside for the time when you don’t want to, or can’t work anymore? How about building up a financial legacy that can be left for future generations?

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Even if you have the means to generate enough income, it is important to direct some of your money into creating assets that can continue to earn for you. The secret to financial freedom is to allow your money to work for you even when you are not working.

I’m Young; I Have Lots Of Time To Save

There is one thing about the young, they think that time is always on their side. How I wish I could turn back time to be 21 again! Knowing what I do now, saving would be my number one priority. In fact, had I adopted the simple plan of saving just 10 per cent of my income, I probably would have millions of dollars in the bank today.

If you decide to spend all your money when you’re young, it will almost be impossible to catch up on the lost interest when you eventually ‘settle down’. The magic of compounding works harder on your money the longer you save; so as you spend each dollar today, visualise the millions that you could be giving up tomorrow.

I’m Too Old; It’s Too Late For Me To Save

This is a particularly tough case; it is true that the later you begin to save, the harder you have to work to build a nest egg. Financial guru and author Jean Chatzky explains that you first have to change your money mindset. “Give yourself a second chance at attaining wealth, and commit to doing what it takes to get there,” Chatzky asserts.

If you are over 40 and just recognising the importance of saving, you need to save as much of your income as possible, find ways to earn more money, consider delaying your retirement age, and become prudent with your spending in order to make your money last longer.

I Don’t Have The Time

This excuse is just inexcusable – you are so involved in your work that you can’t afford the time to ensure that your finances are secure. If you won’t make the effort to manage your own business, then who will? Here’s a little wake-up call – if you can’t find the time now to plan for your savings, be prepared to work for the rest of your life.

Approach your savings with the same diligence as you do on the job. You need to devote time to research the right financial institutions, open the appropriate accounts, set up automatic deductions, plan for your savings goals and review the growth of your portfolio. As Chatzky’s best-selling book declares, it’s time to ‘make money, not excuses!’

Copyright © 2009 Cherryl Hanson Simpson. No reproduction without written consent.

Originally published in The Daily Observer, July 30, 2009

Cherryl is a financial consultant and coach, founder of Financially S.M.A.R.T. Services. See more of her work at www.financiallyfreenetwork.com and www.financiallysmartonline.com. Contact Cherryl