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Author: Wendy Ng

The Power of Budgeting

Budgeting has gotten a bit of a bad name. None of us like to show-off the fact that we're being careful with our money.

We're all keen to show off on Facebook or Instagram whenever we're living it up on holiday or having a big night out with mates. But would you ever snap a selfie of yourself neck-deep in a spreadsheet, counting the totals on your receipts?

Didn't think so...

Despite this bad wrap, budgeting is one of the most important skills you'll learn in life, especially as you grow into adulthood and look to settle down and start a family. Getting into bad spending habits now will mean they're harder to break further down the road.

Change your way of thinking

When it comes to planning your budget, and to putting it into practice, don't think of your budget as some buzz-kill restrictive force, stopping you from doing the things you enjoy in life.

Think of your budget instead as a plan put in place by your wiser, more financially responsible side. This alternate version of you just wants to look out for your future, and they love to see you save so you can really enjoy yourself when the time comes.

Learn to love budgeting in 30 days

The best way to see the brighter side of budgeting is to show yourself the reward that proper saving can generate, with minimum effort. If you were to change some of your everyday activities, ever so slightly, the results can be a real boost to your balance.

The numbers are simple. If you can save $250 in a month, in four months you'll have a grand. $1000 - that's enough for a pretty decent holiday, a new wardrobe for summer, or even a deposit for a new set of wheels. Here's how it's done:

  • Cut back caffeine – Say you spend $3.50 every morning on a cup of coffee, and some days you double up and have one in the afternoon as well. Make that 7 coffees a week. At $3.50 a pop, you can save $24.50 a week just by grabbing your morning caffeine hit at home. Over the course of the month, that’s a saving just shy of $100. We’re off to a good start!
  • No more long lunches – A couple of times a week you buy your lunch at work, right? After all, sometimes you need a break from routine. If you’re buying lunch for any less than $10 a pop, I’d be surprised, so at $20 a week, those sandwiches or salads from home could be saving you $80 over four weeks. The savings are racking up already…
  • On the wagon – When Friday afternoon rolls around, the lure of the pub can be hard to resist. But when you’re paying an average of $5 per drink, this little treat can add up. If you enjoy a couple of well-earned cold ones or buy a round for colleagues, you can easily be parted with $20-$25 in a sitting. Extrapolate that out over the month, and we’ve got between $80-$100 in further savings.
  • Hit the pavement – Outside major cities, most of us drive our cars to get to work. A tank of fuel costs around $65 for most of us, and around two-thirds of that tank would go towards travel to and from work. That means we’re spending around $40 a week on petrol commuting to our jobs. Consider that if you were to travel by train or bus, you would cut your transport costs in half, and if you’re able to walk or cycle to work, you’ll make a saving of $40 a week. Over the course of the month, that adds up to $160. Astonishing!

So, our goal was to change our habits just enough to make everyday savings adding up to $250 a month.

If you've been keeping count, we've shown you ways to potentially save up to $400 a month!

Be flexible

If you're new to budgeting, the important thing to remember is that just because you might have one slip up in a moment of weakness (we know how good fresh coffee smells in the morning), you shouldn't just pack the whole thing in and give up. Budgeting is give and take. There may be times when you're able to make extra savings, and vice-versa, you'll have times when your spending blows out slightly. Staying the course and getting into the habit of budgeting is the end goal. Hang in there!

For beginners...

If you'd like a bit more info on how to set up a personal budget, our handy How-To Guide is just the ticket. It's full of useful stuff, including our Saving Calculators, and we've laid the process out for you step by step.

And if you're after a High Interest Savings Account to help your savings grow, why not check out our Bonus Saver or Life Saver Accounts? They've been designed with the thrifty in mind!

If you found this blog useful and would like to be kept up to date with regular financial hints and tips, why not connect with The Greater on Social Media?