Wedding? Mortgage? Leather jacket of your dreams? Here’s how to keep your financial goals on track
Are you feeling overwhelmed at the enormity of your savings goals? Perhaps you are drowning in debt and unable to get ahead?
Are you feeling overwhelmed at the enormity of your savings goals, thinking your home deposit is unachievable? Perhaps you are drowning in debt and unable to get ahead? Or you could be managing just fine, but you’d prefer to be a little more comfortable, or to be able to save for something special such as a wedding or holiday.
While these big goals and dreams may seem like huge mountains to climb, if you spend a little time tackling the small stuff, you just might find they’re not as impossible as they first appear.
I’ve compiled a list of my favourite tips to help others keep financial goals on track.
Each one is simple and relatively easy to implement, but put them all together and you’ll have a brand-new outlook towards managing your money, and a bank balance to match.
1. Having a financial tracker is important
The first step is to come to terms with the fact you need a budget. If that sounds like a dirty word to you, try calling it something else, such as a spending plan or expenses tracker. These novelty names can help encourage partners and children to jump on board too!
If you don’t know what you’re spending, how can you take charge of it?
Bank statements are really helpful here, as they’ll detail all those little purchases you’ve forgotten about by the end of the month.
2. Being conscious of the unconscious spend
It’s so easy to tap and go with plastic fantastic these days, and before you know it, you’ve drained the bank account.
Some people prefer to use cash for splurge purchases like coffees and pedicures, because the visual of handing over the money helps them keep on track. Others have a separate account and when it’s gone, it’s gone.
3. Set a goal and put a price tag to it
What will your wedding, trip to Europe or house deposit cost you?
Figure that out and work backwards, dividing the total figure by the number of pay cycles you have left before the event.
Every time you’re tempted to spend on a frivolous item, remind yourself it’s only delaying you achieving this big goal.
4. Review where you can save money
Compare deals for your utilities, loans, insurance, credit cards, internet and phone plans at least once per year.
Sometimes just making the phone call and saying you’re thinking of switching is enough to convince your current provider to offer you a better rate or a month for free.
When you lock onto a cheaper plan, direct the money you’re saving straight into debt repayment or your savings account.
5. Seek out all the discounts
Another rule successful money managers live by is never pay full price.
That might mean waiting until your favourite store has a 20% off sale and stocking up, or buying the kids clothes for next year at the end of the season when they’re reduced to clearance prices.
Savvy spenders know which shops will price-match, they scour the internet for discount codes and free shipping offers, and they make the most of sites such as Groupon and their local entertainment voucher book.
6. Buy what you need, when you need it
Australians waste so much food! And it’s not only bad for our hip pockets, it’s terrible for the environment.
When you become more conscious of your food waste, you’ll save loads of cash and be able to feed your family nutritious meals with fresh, seasonal produce.
7. Live as though you already have a mortgage
If it’s a new home you’re saving for, figure out how much your repayments are likely to be. If you’re currently paying $3,000 a month in rent, but your repayments will be about $4,000, start putting the difference away in a separate bank account now. Not only does it boost your savings and help build your discipline, but it also shows potential lenders that you can afford a mortgage.
Keep on running
Saving money and achieving financial security is really just a habit like any other.
If you were training for a marathon, you’d work towards this goal each day, and if you had a setback like an injury or illness, you’d dust yourself off and keep on going.
The same is true for managing your finances.
If you spend a little too much one week, commit to spending the next week or two at home rebuilding your slush fund. It’s never too late to get back onto the savings wagon.
Make it fun, challenge yourself to smash your goals, and don’t forget to celebrate when you achieve them. You deserve it!
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