10 realistic money saving tips you can start now
Setting a New Year's resolution or talking about wanting to save more money is one thing, but actually doing it? That's a bit tough.
What makes it even more difficult is when there are so many 'money saving tips' out there that are really complicated, or impossible to actually incorporate into your daily life. To help you hit your money saving goals, we've put together this guide full of simple tips that you can start using straight away.
1. Set goals
When you're saving money, goal setting is key – knowing what you're saving for may provide the extra motivation you need to achieve your target amount. According to the Australian Securities and Investments Commision (ASIC), 85% of Australians have a specific objective in mind while saving1. The top three savings goals are:
- A rainy day fund, and
- Buying or renovating a home.
Remember to make sure your goals are achievable and measurable, so that you can keep track of how you're doing. And don't stress about the odd setback!
2. Make a budget
Start by looking at where your income is going. The 50-20-30 principle can be a useful rule of thumb for deciding how much to allocate to different expenses. Bear in mind, this is a guide and you may find you need to adjust the percentages depending on your income.
The 50-20-30 rule says that you should put:
- 50% of your income towards essentials like bills, food, mortgage repayments or rent and transport;
- 20% towards your savings or debt repayments; and
- 30% towards the things that you enjoy.
If you need a helping hand, Suncorp's free online Budget Planner can help you get started . Or if you already bank with us, 'Dollar Tracker' is available via the Suncorp App and automatically categorises your daily spend into 14 expense categories. By offering insights into your spending habits, it may also help to guide your money-related choices.
3. Know your big expenses
Being aware of any upcoming large annual or one-off expenses can help you plan (and be ready) for them in advance, which could help to reduce financially-related stress. For example, you may want to budget for your car rego or a car service, quarterly rates bills or even Christmas expenses earlier in the year so that you're prepared come December. By dividing these commitments into smaller amounts each pay day, perhaps with regular transfers into a savings account, you may be less likely to overspend or be caught out when the bill arrives.
4. Aim to reduce any debt
Debt is more common than you might think, but it can also be really hard to shake. Start by listing all your debts so you know how much you owe. By prioritising your debt and having a plan about which debt you want to pay off first – a good idea may be to start with the most expensive debts, based on interest rates and fees - you may improve your capacity to save in the long term.
5. Consider an online savings account
Online savings accounts generally provide higher interest rates than everyday bank accounts. Additionally, with mobile and internet banking, it's easy to manage your accounts on the go so you can transfer funds easily between your accounts.
To help manage your savings, take a look at Suncorp's Everyday Options account. It offers the convenience of a traditional everyday account (card access) with up to 9 linked online savings sub accounts.
6. Try bucketing your money
Bucketing your money involves splitting your income into sections, or 'buckets'. To do this, you might use different accounts for different purposes. With Suncorp's Everyday Options Account , you can set up separate sub-accounts for your savings or expenses. By allocating your income in this way, it can be easier to stick to a budget and not cut into your savings by being a little spend happy.
7. Automate your savings
Save yourself time by automating your savings contributions. All you need to do is set up a recurring transfer from your main account, generally the one that your income is paid into, to your savings account, then sit back and watch your savings grow.
It's important to be aware of any conditions attached to your online savings account, such as a bonus interest rate if you deposit a certain amount each month. Often, these accounts will offer higher interest rates than ordinary online savings accounts.
Suncorp's Growth Saver account is an example of this kind of account. It rewards you for regular savings with bonus interest for every month that you grow your net balance by $200 or more (excluding interest), and make no more than one withdrawal per month. Which is ideal for helping you reach those longer-term savings goals!.
8. Research whether rewards programs will work for you
Rewards programs are often linked to certain types of credit cards. They provide points for dollars spent, which can be redeemed for eligible purchases from electronics to travel. If you use a credit card regularly, you may benefit from rewards programs. Suncorp's Credit Card Rewards, linked to the Suncorp Clear Options Gold and Platinum Credit Cards, offers merchandise, travel, gift cards and even cashback to your credit card account for points earned. Just be sure to pay off the balance every month to avoid the card's likely high interest rate.
9. Use smart alerts to avoid paying additional fees
Checking your account balances regularly can help you save on fees. If you're a Suncorp customer, you can save time if you set up free automatic balance alerts via online banking. Emailed alerts notify you if your account balance goes over, or falls below, a certain amount. In doing so you'll avoid additional fees, such as payment honour or dishonour fees, or transfer failure fees, which are incurred if your account is overdrawn.
10. Assess (and re-assess) your savings strategies
Saving doesn't need to be a chore, and developing good habits now can come in handy down the track when you're looking to go on an overseas holiday or purchase a new house. Don't forget to assess your savings strategies every now and again, and if you see room for improvement think about the ways you can potentially do better.
It's always a good time to start saving for something that matters to you. For habits to stick, keep in mind our 10 realistic money saving tips and remember to celebrate your achievements.
- Using a home budget to boost your savings
- How to budget and save money
- How to setup a personal budget plan
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