Co-author: Michelle Norton
Most people in their heart of hearts could save more. Did you buy an energy drink or a coffee on the way to work today? Is there chewing gum in your bag or car? How often do you buy songs or movies on iTunes? And do you buy chocolate bars from the dairy when you’re feeling down? Just one $4.50 latte, or an energy drink and a chocolate bar, a day adds up to $1638 a year.
That $31.50 a week that you’re throwing away, guzzling at the coffee shop or dairy, could be worth $20,000 in 10 years if invested at a 4% return, or $161,000 over 40 years.
Don’t know where to start when picking a savings account?
We all have our weaknesses. Take charge, get off the consumption treadmill, and you could soon have enough money for an emergency fund, overseas trip, or even a first home deposit. Here are seven money saving tips to get you started:
1. Leave your credit and debit cards at home
It’s psychologically easier to spend money on a credit card than it is to hand over physical money. Every time you go to buy something and realise that you can’t because you don’t have a card, save that money.
2. Use your smartphone
Your smartphone gives you access to your bank accounts wherever you are. If you avoid spending on an unnecessary item, stop, log in, and transfer that amount to your savings account.
3. Start a savings jar
When you’re out, only spend notes, not coins. At the end of each day, drop the change in your savings jar.Take it to the bank regularly and watch your balance grow.
4. Quit your bad habits
If you want to quit a habit and save more money, then set up a “swear” jar and pay money into it every time you break your rule. If you have children or flatmates enlist them as watchdogs to keep you honest.
5. Do it yourself
Grow your own veges, clean your own house, bike to work instead of taking the car or public transport, borrow books from the library, cook meals, take cut lunches, and so on.There are numerous ways right under your nose to save a dollar here and a dollar there.
6. Set up automatic payments
If you want to put $5 or $10 a week aside to save, set up automatic payments so that the money is transferred to a savings account each and every week.
7. Switch up your thinking
If you still think it’s too hard to save, then you might need to switch up your way of thinking. Ask around. You’ll have friends and family who have made the choice to save and their money will be adding up. Try to learn one tip from each.
Finally, remember $1 today will be worth a lot more to you when you retire if you save it instead of spending it. Every dollar that comes into your hands is valuable. Don’t waste it.