Whether you’re saving for your first home, pining for a holiday or facing financial stress, there is never a bad time to take charge of your finances and become money smart.
These tips will show you how to manage your money better and get your finances back on track.
1. Set Goals
The first step is figuring out exactly what your end game is. A big juicy goal like a family holiday to Hawaii, a deposit on your first home or blitzing your credit card debt will keep you going when your resolve is waning.
Make sure you break up your larger goal into smaller, achievable milestones to keep the achievement factor high and motivation flowing.
2. Review expenses
The main component in building up a decent savings buffer is to spend less than you earn. It sounds so simple, yet many people use credit to inflate their lifestyle and spend more than they make. Don’t be those people.
To get you on the right track you’re going to need a budget. Firstly you need to write down your core expenses (rent/mortgage, electricity, transport, insurance, groceries).
Then total up your income. If your core expenses are higher than your income, you have some adjusting to do.
3. Make savings
The good news is there are plenty of ways to save money on your everyday expenses. You could cancel your gym membership and cycle to work, saving you both the gym membership fee and transport costs. Start meal planning and batch cooking for the week so you won’t be tempted by takeaways.
Other simple money saving tips include carpooling with colleagues, making your own lunch for work, running a cold wash and line drying your clothes to save electricity, requesting free samples before committing to a new product, eating vegetarian meals a couple times a week or swapping your daily flat white for a french press made in the office kitchen.
Use a savings calculator to see exactly how small changes made a big difference to your goals.
4. Start a side hustle
Earning more money is an easy way to slam your debt or supercharge your savings. It’s money you didn’t have before, so just pretend it doesn’t exist and stash it towards your goals.
This list of online side hustles is a great place to get some ideas. Also, make sure you’re all good with the ATO. This guide will help you make the right decisions when it comes to paying tax on your extra income.
5. Implement your plans
Learning how to save money is one of the most useful life skills you can acquire. A saver is better able to weather a financial downturn, pounce on an investment opportunity or scoop up a bargain holiday at the last minute without going into debt.
The best part is anyone can learn how to save money, by applying these 4 simple steps you’ll transform your life and finances and be sipping a Blue Hawaii on Waikiki Beach faster than we can say ‘Aloha’.