5 Ways to Save Like a Boss
From a very young age most of us are always told to save, save save!
“Honey, you should be saving your pocket money”
“Son, don’t spend all your dough on booze you should save for your future”
“It’s always a good idea to save, you never know what’s around the corner!”
But these throw-away sayings from the important people in your life usually aren’t welcome or helpful because at the end of the day everyone finds themselves wondering how it’s possible to save when there never seems to be any money left before pay day.
If you’re nodding your head in agreement while reading this then stay with me… I’m going to lay it out very simply so you have a game plan next time you get paid.
First let me explain a couple of basic reasons why saving is important:
Australians own 18 million vehicles and maybe you want to own one too (or maybe a better one than you currently have).
Nearly 70% of Australian households own a home, usually with a mortgage… you’ll probably want to join the ranks in the coming years.
Emergencies. Full. Stop. Emergencies happen all the time, maybe you lose your job… or maybe you knock a couple of teeth out skateboarding home from work… either way you’ll potentially have to cough up thousands in a moment’s notice. Hence, everyone must prepare for emergencies.
Now, wondering how to save like a boss? Read on my friend.
Step 1. Work out what you’re spending.
Do you actually know how many direct debits you’ve got set up? Or how much your beer splurges at the pub add up to by the end of the month? Write down your income and outgoings. Be honest about what you are actually spending – it can be tempting to leave things out!
Step 2. Decide where you can cut back.
What essential spending do you have and where is your money going down the drain on expenses you’re not enjoying or in need of. Luxuries be gone! (If only for a little while) and ditch those silly bills.
Step 3. Make a budget.
Save smarter not harder by keeping it super simple. Have a bills account, a spending account and a savings account. Make sure your pay gets transferred to your bills account. Then withdraw a set amount each week for spending, and stick to it! What’s left in your bills account is for actual bills, that need paying (to actually live). A good place to start is to set aside 5-10% of your income in your savings account and DON’T touch it! You’ll see it grow quicker than you think.
Step 4. Prioritise your debt
Pay off the plastic as fast as you can because you’ll save a heck of a lot of money by not paying interest! Pay off as many debts as you can, so start with the small ones and work your way up to the big loans (it helps you mentally by playing strategic like this).
Step 5. Set goals and celebrate them.
Like all Parks and Rec fans, we too believe everyone should “Treat Yo Self”, but only after setting a few targets and reaching them. Setting short and long term goals is a great way to motivate yourself. One of life’s biggest rewards is buying that thing you have always really wanted to and owning it outright… today it might be a computer, and in 10 years it might be your very own house!
Sometimes it’s easier to come up with a “savings game plan” with the help of an expert. If you want some help setting up your budget then feel free to contact the team at Focused on Finance today. We could also help you set up a timeline when it comes to your goals of owning a house or car or boat or bike. We help clients all the time and we’d love to see you succeed in the savings game too!
