If it feels like you’re burning through your savings, it might be time to consider some new strategies.
Saving money is a good habit that becomes easier with practice. However, if you need some tried and tested strategies to start you off, we’ve compiled some expert tips to help set your family up for financial security.
1. Pocket your insurance savings
If you have home, car or health insurance (or all of the above), assign some time to compare your policy with what else is on offer on the market. You may find a better deal out there.
Blake Delcanho, General Manager – Member Products and Propositions, from HBF says reviewing your health insurance to see if it matches your family’s current needs is a great place to start.
“For example, if you got hospital cover for pregnancy and birth, but aren’t planning on having more kids, there may be a cheaper option that still offers enough coverage to give you peace of mind,” Delcanho begins.
“For your hospital cover, if you think you’re unlikely to end up in hospital, you may want to consider a higher excess as it means you will generally pay a lower premium.
“Some insurers, like HBF, also let you mix and match your hospital with your extras cover to create a level of cover that suits you – this can also provide more price flexibility.”
“Call up a few health insurers and get a quote. Ask them what might suit your family specifically, considering your age, your kids ages, and any health risks you might have.”
Just remember, it’s about finding cover that suits your needs and fits into your budget. And if you’ve already got health cover, it’s a good idea to review it regularly to make sure it’s still right for you.
2. Cull your debt
According to the managing director of financial advisory and wealth management firm LCI Partners, Gerry Incollingo, a top priority should be paying off your debt, including your mortgage.
“Aim to put away 20% of your wage each payday, or put that 20% towards erasing your debt,” Gerry begins.
“Interest is what we call ‘bad debt’. This means you’re essentially throwing away money you could be saving. So, get rid of your debt first.”
3. Set a savings goal
While reducing debt is a good start, ideally you will add to your savings simultaneously. In the event something prevents you from working (like a pandemic), it pays to have a rainy day fund. Gerry says aim for a three-month buffer initially – then keep going if you can!
Put another 10-20% of your wage into savings if your budget allows (yes, you should have one of those too). Meanwhile, separate you savings and spending accounts so you’re not accidentally spending your buffer funds.
4. Check your energy use
Monitoring your energy use can help shave serious dollars off your household expenses. Investing in a smart meter can help, but there are other ways to reduce your energy without spending a cent.
Firstly, remember to turn off lights, reduce your showers and keep your thermostat between 18-20°C in winter and 25–27°C in summer.
Meanwhile, take a day to defrost your freezer and carefully dust or vacuum the condenser at the back of your fridge. Also, empty out the filters in your washing machine, dish washer and dryer. Burdened electrical appliances can work overtime, sucking up energy for basic functions.
Finally, turn off your idle electronics like your TV, microwave or computer monitor while you sleep at night. You can get a master switch or power board to help, or simply do it manually.
SEE MORE: Benefits of eco-friendly homes
5. Remove temptation
Online spending has never been easier, but if you find you’re getting sucked into spending by the convenience, try and place some obstacles in your way.
“Delete any apps that you know are spending traps for you, such as food delivery apps, Amazon and anything that makes it easy for you to spend without giving it too much thought,” Gerry says.
Similarly, unsubscribe from emails or unfollow accounts that pique your urge to spend.
“Another good way to prevent impulse buying is to make a list of the items you want right now but don’t need,” Gerry adds.
“Put it aside for two weeks then come back to it and consider if you still want these items. Chances are you won’t.”
6. Can you share your car?
The share economy offers a decent side hustle for those who are willing. Consider creative ways you can earn, as well as save.
For instance, if you have two cars and one isn’t used frequently, perhaps you could pop the other on an app like Car Next Door, which essentially leases your car to others.
Similarly, do you have a carspace you don’t need (you could make a fortune on this if you’re near the city or a train station)? Can you sell your clothes on Depop or Facebook Marketplace? Maybe you could rent your spare room as an office?
Think about things you don’t need and consider if they have any value.
7. Reduce, reuse, recycle
Finally, one of the best ways to save money? Buy less!
Ask yourself if you really need to buy something brand new or if you can find it second-hand. Do you really need a new item of clothing, book or gadget?
Not only will you ultimately save items from going into landfill unnecessarily, but you’ll nab a bargain too.
Turn recycling into a financial teaching moment with your kids by encouraging them to save bottles and cans that can later be put into “return and earn” depositories.