Tips for Reaching Your Savings Goals Faster

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piggy-bank-1270926_1920Saving money for a big-ticket item, like a home or a new car or that dream holiday, can seem like it will take forever. Even many of the savings tips available seem to advise you to cut back on all of your spending and live like a scrooge until you achieve your goal.

However, you’ll be amazed at how much money you can save by making a few small changes in your life. By rearranging the way you spend your money, it really is possible to save more without going to extremes.

It’s not always easy to know where to start, so we’ve come up with a few of our best savings tips that can really help boost your savings efforts.

Tip # 1 – The Coin Jar Technique

Our first tip is one of our favourites. In fact, it’s one we actually use because it’s easy and it works.

Each night, take out all the loose change you’ve collected throughout the day and drop the coins in to a large jar or tin. Once the jar is full, deposit the coins in to your savings account.

Many banks have self-serve coin counting machines so all you need to do is take your jar to the bank and let the machine do the counting. Some ATMs also have coin deposit facilities these days making it even easier for you to deposit your loose change.

It may take a few months to fill the jar, but you’ll be surprised at how much you’ve actually been able to save. Putting away your loose change might only be a small step, but along with other saving tips and techniques, it all adds up over time..

Besides, every extra dollar gets you closer to reaching your savings goal.

Tip # 2 – Reduce Your Energy Bills

The majority of savings tips focus strongly on telling you to give up buying that daily cup of coffee or packing your lunch each day. However, by making a few little changes to the way you use energy around your home, you could reduce your overall costs quite easily, which gives you more cash to add to your savings.

Think about how many electronic appliances you have around the home that you leave in ‘stand-by’ mode. While those appliances aren’t in use, switch them off at the power point so they aren’t still using power.  Even your mobile phone charger can draw power just by leaving it plugged in.

During the cooler months, think about dropping your heater’s thermostat a few degrees. Running your heater at 19C instead of warming up rooms to 23C can save you quite a bit on your heating bills.

The same is true with air conditioning through summer. It’s not really necessary to set your air-con to 19C during summer, when you could set it to 24C and still feel much cooler than a sweltering 40C outside. You’ll also be helping to keep your energy bills under control.

Companies like EcoVantage (http://www.ecovantage.com.au/free-energy-saving-products-south-australia/) will offer to replace up to 20 light globes in your home and replace them with energy efficient LED globes that use significantly less power. They can also install up to three water-saving showerheads in our home to help reduce water consumption too.

Tip # 3 – Negotiate for Better Deals

Why pay more money for the things you already use than you need to? Take some time to shop around and compare some of the deals available for things you already pay for.

Your mobile phone and internet plans might have been great when you first signed up, but are there better deals available now that could give you more options for a lower monthly bill?

The same is true with your insurance policies. Take a look at your existing policies and see what you’re paying for the level of coverage you receive. Then shop around to see if you can get the same – or better – coverage for a lower monthly premium through another insurer.

If your homework shows you some companies offering better deals, go ahead and call your existing provider and see if they’ll match the deals on offer. If they won’t match the deals you find, make the switch.

Tip #4 – Slash Your Interest Rates

Do you know how much interest you’re paying on your outstanding credit card balances? Most people also don’t pay much attention to the interest they’re paying on their car loan.

By reducing the interest rates you pay on your outstanding debts, you could easily reduce your monthly repayments. Ask your existing bank whether they’ll negotiate for a better deal on your outstanding debts.  You might also consider a debt consolidation loan that could dramatically reduce the amount you pay on monthly repayments.

Discuss restructuring your finances with a good mortgage broker and see if you can find banking products with lower interest rates and better terms.

You can put the money you save towards paying down your debt balances faster.  Once those debts are gone, you can deposit the amount you were paying on your repayments into your savings account to help you reach your goals even faster.

Tip # 5 – Savings on Auto-Pilot

 One of the easiest ways to boost your savings plan is to put your savings on auto-pilot. Arrange for a specified amount of money to be debited from your pay or your bank account and have it automatically deposited into your savings account. Then stretch your remaining cash as far as you can until you get paid next pay day.

Lots of people try to save money by living for the entire week or fortnight until pay day and then trying to save what’s left after everything is paid. However, if you’re like many others you’ll find there’s often not much left by the end of the week or fortnight.

By having your savings deducted automatically you build up your savings account faster. You’re also forced to find ways to budget and stretch your remaining money until the next pay day, which reduces the temptation to spend on unnecessary things during the week.

Tip #6 – Review your Subscriptions and Memberships

We often sign up and subscribe to things that seemed like a good idea at the time, but in reality it ends up being a waste of money and we can’t be bothered cancelling them. If you’re keen to boost your savings goals, take the time to review any subscriptions or memberships you’re paying for.

Magazine Subscriptions: If you have a number of unread magazines gathering on your coffee table and you’re just not reading them as much as you’d like to, consider cancelling or not renewing the subscription. You may want to subscribe to a cheaper digital version or even search for similar, and free, articles that may widely be available on the net. Websites such as ISSUU have a large collection of free to read publications available from around the globe.

Pay Television: Pay TV is great but can be an expensive exercise, especially if you’re not making good use of it. With the many new options available, switching to online streaming media services such as Netflix and Stan, which cost around $10 to $15 per month, can save you hundreds of dollars a year in pay TV charges.

Gym memberships: With all good intentions, many of us sign up to a gym but rarely go and never get around to cancelling the memberships. Paying for a service that you’re not using is waste of money, so look at cancelling the membership and switch to free or low cost alternatives such as walking and jogging.

Some subscriptions and memberships may be on a plan or contact so be sure to get informed of any fees and charges that may apply on exit.

Tip# 7 – Check Your Banking

We all have bank accounts, but if  yours isn’t the right one for your financial situation and goals or if you’re not using it correctly, it could end up costing you more than it should.

Transaction Accounts Take a few minutes to check your bank statements every month. Your statements might seem boring initially, but they can highlight just how much you’re paying in fees each month. Checking your statement can also show you if there are any unauthorized transactions on your account you might otherwise have missed.

Some banks charge monthly account fees, while others may charge fees for certain types of transactions. For example, you might pay fees for withdrawing cash from another bank’s ATM or for transactions conducted in the branch over the counter.

Check your account balances regularly, especially if you have direct debits coming out of them. If you keep an eye on your balances you reduce the risk of being charged overdrawn fees.

You can avoid or limit any transactions that might be costing you money or switch bank accounts to avoid paying monthly account fees.

Savings Accounts: It’s common for people intent on saving money to shop around for a savings account that pays a high interest rate on their cash. However, it’s also important to choose the right type of savings account to suit your needs.

For example, a fixed term deposit account might offer a competitive interest rate, but your cash is locked away until the term expires. Some banks also pay bonus interest if you deposit a specified amount of money each month, but you won’t earn the bonus if you withdraw money from the account.

Online savings account might also offer higher interest, but may not make it easy for you to access your cash when you need it.

Shop around with different banks and financial institutions and check how each type of bank account works.  Then choose the one that suits your savings goals best.

Credit Card Accounts: don’t give in to temptation to withdraw cash from your credit card, as you could be charged Cash Advance Fees. You may also be charged a cash advance interest rate, which can be higher than the purchase interest rate on your credit card.

Tip# 8 – Take Control of your Finances

Our final tip is to encourage you to take control of your finances. Take the time to know where your money is going. Become familiar with your regular expenses and spending habits and look for ways you can minimise them or reduce them wherever you can.

Create a budget and know exactly how much you can afford to save each week or month. Don’t forget to treat yourself occasionally too and include the expense in your budget.  After all, just because you’re saving doesn’t mean you have to go without all the fun stuff.

Saving is a lot of work and will require a good amount of discipline but the benefit will be that you’ll be getting closer to putting a deposit on a home, buying that car or going on that holiday you’ve been dreaming of.

We hope you enjoyed our money saving tips. Remember, lots of small actions all add up over time and can help you get closer to reaching your savings goal.

If you have any favourite savings tips you’d like to share, please let us know. We’d love to hear about them.

Marco Barsotti
Property Consultant
e: mbarsotti@nieuvision.com.au

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We recommend that you seek independent financial and taxation advice before acting on any information in our articles and newsletters. They contain general information only and have been prepared without taking into account your personal objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances. Your full financial situation will need to be reviewed prior to acceptance of any offer or product. Interest rates are subject to change without notice. Lenders terms, conditions, fees & charges apply.

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Disclaimer: We recommend that you seek independent financial and taxation advice before acting on any information in our articles and newsletters. They contain general information only and have been prepared without taking into account your personal objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances. Your full financial situation will need to be reviewed prior to acceptance of any offer or product. Any mention of interest rates are subject to change without notice. Lenders terms, conditions, fees & charges apply.

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