Not feeling the love for your savings account?
With so many increases in the cost of living, many of us are feeling the pinch in our savings accounts. We regularly hear of people actually having to dip into their savings to make ends meet, or make purchases that just couldn’t be put off any longer. That’s a hard decision when you’ve worked hard to grow your savings over the years.
Whether you’re saving for something special like a first home or just saving for better financial security, it pays to make saving – not spending – your top priority.
The truth is, things could get worse for some of us, so we need money saving strategies and better budgeting ideas to stay on track.
Try these 3 simple money saving tips to help you save more and budget better!
1. Put savings on autopilot
Our #1 money saving tip is to take the thinking out of it!
An easy way to be sure your savings don’t miss a beat is by setting up an automatic transfer from your everyday account to a savings account each pay day.
Select a realistic amount so you won’t be left scratching for cash halfway through your pay cycle. The money left in your everyday account is yours to spend as you please.
2. Try the 50:30:20 method
This one’s easy. Divide your take-home pay into three set portions.
For some people it might be like this: 50% for living costs, 30% for fun stuff like dining out, and the remaining 20% goes straight to savings. The portions can be adjusted year by year, if your income and expenses change, but they key is making sure there’s something going into savings regularly – not just once in a while.
Think about setting up separate accounts and dividing your money between them. The account for long term savings is “only for saving, not spending”. This can make it easier to stick with your chosen spending portions – and easier to meet your saving goals.
- Extra tip: Consider increasing your savings percentage when you can, if you don’t have bad debts, like credit cards.
3. Say ‘hello’ to budgeting apps – and goodbye to spending apps
One of our favourite money saving tips is to use an app to help you. There are plenty of apps to keep you stay on track with spending and saving, so check out some popular apps to see which one suit your circumstances. They can really help you save more money and budget your money better, by helping you track your finances, create – and achieve – saving goals, sync banks accounts and set up automation.
If a digital approach to money management works for you, these apps can be the key to growing savings.
On the flipside, plenty of apps encourage us to spend more. From buy-now-pay-later apps to food delivery services. The common thread is that they make it harder to stay faithful to a budget.
Skip the “app trap” by deleting spending and pay-later apps from your phone – these tend to encourage you to spend more than needed.
Extra Savings Idea:
What about unexpected income or windfalls?
Sometimes you may get a bit of unexpected money. Or even a lot, if you’re lucky.
A common reaction to getting “surprise cash” like an inheritance, prize or a bigger than expected tax refund, is to spend it fast. Ken Thomas, General Manager at Etax, has seen this countless times, and he suggests,
If you receive money you didn’t expect, just take a breather and sit on it for a while. After a week or two, you’re more likely to do something smarter with the money that you’ll be happy about – and won’t regret.
“During that time, you might think of something important, or something awesome, that you didn’t consider at first. Once you get over the excitement of receiving the extra cash, it’s a lot easier to do something strategic for your future, like pay off debts.
We all get excited about receiving money, but the real excitement should come when you pay off bad debts like credit cards, or leap ahead with your house down-payment. That’s when you really start to get ahead.”
Remember, Etax is here to help you maximise your tax refund. The extra money could be the kick-start you need to get you savings moving. Your Etax tax agent will help you get the biggest refund possible.
Disclaimer: The information contained in this article is general information only. You should always consult a financial advisor before making any decisions regarding your own personal finances.
