Lesson 4 – The Habit of Saving

Saving and the Law of Habit

  • Saving money is solely a matter of habit


  • If you include a definite plan for saving a certain amount of your income in the written statement of your chief aim, your mind will accept this saving of money as habit


  • Most of us are raised by parents that don’t understand the psychology of habit
    • Without knowing it they form the habit of spending in their children by overindulgence with spending money and lack of training in the habit of saving
    • The habit of saving is one of the most important lessons to teach to a child


  • When you give the average person $1000 they immediately start to think about how to spend that money, not to save it
    • We are ruled by our habits!
    • You should strive to train your mind so saving money becomes a natural part of your life


  • Following the systematic habit of saving a definite proportion of all the money you earn or receive is the only way to ever achieve financial independence
    • If you don’t learn how to save you will never be financially independent because you will always adapt your spending to your earnings



  • It is impossible to do your best work when you are being weighed down by debt


  • Unless you free yourself from your debt you will forever be its prisoner


  • Debt amplifies the fear of poverty and greatly decreases your ambition and self-confidence


2 Classes of Debt:

1. Debt incurred for luxuries that become a dead loss


  • Should be avoided at all cost, only buy luxuries when you know you can afford it


2. Debt incurred in the course of professional or business trading


  • Use good judgment when making decisions that lead to these kinds of debts, if the investment is a sensible one, it can make sense economically


  • Avoid spending beyond your limitations as this would lead to speculation and can have very serious consequences


Saving and the Fear of Poverty

  • The fear of poverty is a negative, destructive force
    • Moreover, one negative state of mind has a tendency to attract other similar states of mind
    • Fear of poverty may attract fear of ill health or fear of old age, thus people might fall into illness out of fear of poverty or grow old before actually reaching old age


How to Master the Fear of Poverty:

  • If you are in debt, stop the habit of buying on credit and gradually pay off the debt you already owe


  • Adopt the habit of saving a portion of your income as part of your definite chief aim


  • Soon this habit will take hold of your mind and you will find joy in saving


  • The discontinuance of the habit of spending will leave a hole in the mind that must be filled with the habit of saving


Other Key Points


  • It is essential for any business to put away money in case of emergency
    • Countless businesses go bankrupt because they fail to secure themselves in this way


  • For individuals the same goes for savings accounts
    • They enable the individual to seize opportunities when they arise and save them from the embarrassment of having to ask relatives or friends for cash when an unexpected emergency occurs


  • The habit of saving also develops other qualities essential for success


  • Often cutting things like alcohol or other recreational items can have other beneficiary effects like improved health



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1 thought on “Lesson 4 – The Habit of Saving

  1. Having read these lessons,i promise to change myself immediately and embrace positive information contained in this summary notes.Very very in-sighting.

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