I have been studying kanji by learning their meanings first, followed by vocabulary. This approach worked well at the beginning, but now I am getting confused because so many kanji look similar. How to tackle this?
you’ll need to learn some method to tell apart similar kanji. perhaps the easiest is to work with radicals: the elements out of which the kanji are built.
for example 金, the kanji for gold or money, also generally is used as a radical for most metals and related kanji. 銀, 鉄, 銅, all have the gold kanji as a radical on their left side, and they stand for silver, iron, and copper. the right side is also meaningful, silver is good gold, iron is faulty or bad gold, copper is same as gold. and then they become a lot easier to remember and tell apart.
you do still have to learn all the building blocks, and there are enough of them that they can be confusing in themselves. and there are a ton of special cases and exceptions and all. but that’s a basic approach that works for me.
and beyond that, it’s just practice practice practice. my advice would be to add vocab immediately, and try to get to a level where you can start reading as soon as possible.
That's normal, our brains are optimized to put together similarly looking shapes.
So what is needed is to make it "unlearn" those groupings by highlighting the differences. The key is ; don't look at the kanji at a whole (otherwise they will always be "look alike"), but decompose and identify their constituents, so the differences will pop up.
Writing by hand helps for that, as a temporal and directional layer is added to your knowledge of the kanji; sometimes those aspects are very important (like with the kana シ/ツ ソ/ン, their only difference are order and direction of strokes; once you write them by hand that pops up to your eyes, but until then, iy you look only at finished text you may compleyly miss that feature, which makes it hard to tell them appart).
Whith which kanjis do you have difficulties ? We can look to highlight their most striking differences.
EDIT: the renshuu kanji dictionary lists the components, but it doesn't have the reverse (from one component list all kanji using it), you can look at a reply I wrote on another thread for some sites that can do that; getting a list of kanji that share a same component (they obviously will "look similar") will reinforce identifying that component, which in turn will help differentiate when you see a similar yet different shape (eg: 易 (⿱日勿) and 昜 (⿱旦勿))