With the new financial year rapidly approaching, here are 5 easy tips/goals to get you ahead and ideally help you make headway on a savings goal.
By adopting these simple principles, you can be taking solid steps towards a brighter financial future.
Review your bank and credit card statements to identify ongoing debits you barely use or know you can live without.
It could be a monthly music subscription, a gaming subscription your child no longer plays, Netflix or an online fitness membership you signed up for during phase 1 of the COVID lockdown.
Don’t put off cancelling on the basis it’s too hard or you might use it one day, it’s a 15 minute exercise which could save you hundreds of dollars over the next 12 months.
Whether it’s car insurance, house and contents insurance, health insurance or pet insurance, it’s worth comparing your current policy against other providers and transferring over if it meets your needs and saves you money.
There are a number of comparison sites operating throughout Australia, including;
These comparison sites are able to compare various policies for you in one online location. If you’ve not used one before, or would like to have more of an understanding of what to be mindful of when using one, it’s worth referring to the Government’s MoneySmart website which outlines “what to keep in mind when using comparison sites” and provides current and trustworthy information.
When engaging with a comparison site, be prepared to lock in an hour of your time and have a copy of your current policies on hand to help you complete the required information.
Most utility provider websites (electricity, water and gas) will provide calculators, tools and advice on how to actively reduce your utility bill.
In addition, there are other reputable websites provided by the Australian Government that are dedicated to helping Australians access this type of helpful information, including:
By reducing your utility costs, you can then reallocate the savings to other household expenses or ideally, start contributing to a savings account.
This now leads us into our next tip – setting up an emergency fund.
An emergency fund is savings you can fall back on when an unexpected expense occurs, such as a car repair or a vet/medical bill, so you don’t need to borrow or go into any debt.
A 2019 survey indicated that less than 45% of Australians would be able to cover an unexpected $1,000 expense with their own savings, highlighting how the majority of Australians are living pay packet to pay packet and do not having any savings as a safety net.
It’s recommended that you set up a separate account, which ideally pays interest and possibly bonus interest if you meet the minimum deposit requirements.
These days it’s relatively easy to set up a new online savings account within minutes. Just be sure you do some research (e.g. comparison sites, choice.com.au, Government sites) and select an account that best suits your situation.
By setting up a direct payment from your normal account, your emergency fund will consistently grow. Start with any savings you’ve achieved from the first 3 tips and then by having a direct payment to it every week, for example $25, you could have over $1300 saved and available if an emergency expense occurs.
Once you reach an amount you feel comfortable as your safety net, any additional savings can then be towards another savings goal you may have.
In this online world that we live in, we are fortunate to have many free mobile app’s and websites that offer fast and automated guidance for budgeting and managing your money.
A good starting place for such budgeting tools and “spending trackers” is your bank, given they already have direct access to your bank statements.
You may also find the tools and information provided on the Government’s MoneySmart website beneficial, such as:
And remember to always be vigilant with your cyber safety.
Make sure the provider is reputable so your identity and information is protected and secure; here is how Fair Go Finance protects our customers from online fraud as a guide.
By implementing these tips now, you can be in a much healthier financial place and can keep moving forward with your future financial plans and goals.