Ways to cut your expenses and increase your savings
Is smashed avocado keeping you from saving for that first home?
Well not quite, but cutting that out and spending less overall will make a big difference.
Here are some ways you can control your spending to help you reach your savings goals much quicker.
Start by understanding your spending habits
We can lose track of how we are spending our money, especially if we often use Pay Pass or credit cards.
Pay down any unsecured debt and close them, as you are incurring unwanted and often high interest on these debts. Unsecured debt will also lower your borrowing capacity for that home loan we are aiming for.
Note down all of your everyday expenses, direct debits and future bills, this will give awareness to what is actually coming out of your pocket.
There are many online banking systems which include tools to help categorise debits and make a budget – so take advantage of them.
Once you have worked out your weekly spend limit, take it out as cash this way you can physically see how much you are spending.
Saving on the basics
Some costs can’t be avoided – but many of our everyday expenses can be reduced – so look for opportunities to save in all areas of your spending, not just in your indulgences. For example, you could:
Swap out your branded groceries for the supermarket branded equivalent
Buying your fruit and vegetables at the market instead of the local supermarket.
Planning your meals in advanced, making a weekly grocery list and buying in bulk to save money on food.
If you do plan on eating out, most local pubs and RSL’s do have weekly members 2 for 1 specials, so look out for this!
Be conscious of your regular bills, you may get a better deal by switching to another provider or just simply calling up your current provider and asking for discount - you will be surprised at how effective and easy this can be.
Reduce your overspending
If you spend excessively on things like a daily coffee or two, buying clothes, going out or expensive hobbies, it may be hard to cut these expenses entirely. Instead, set a monthly budget for luxury items and reduce that limit over time. Or, if you do come across an item you feel you ‘must have’, don’t buy it straight away. Sometimes it pays to shop around, you may find that same item much cheaper online.
Cancel those unused direct debits
Got a gym membership that you don’t use? Or a streaming service that you no longer watch? Or a phone plan with too much data? Reducing or eliminating these unused expenses will not affect your current lifestyle especially if you are not getting any use from them.
So look back at that budget that you wrote down and sift through used and unused direct debits, a few dollars here and there will add up in the long run.
Overall remember, every dollar you save is one extra dollar towards your own home.
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