We all have the best intentions to save money but when it comes down to it, saving money is not easy. Often starting is the hardest part of saving towards your goal. Here are some top tips to help you achieve your goal and get your finances on track.

Understand Your Relationship with Money:

Are you naturally a spender or a saver? Do you find it easy to spend money or to save your money (believe it or not, some people find it hard to spend money!). We are all predisposed to one or the other. Each trait has both good and bad attributes, it’s all a matter of understanding your identity, brainstorming a plan and working on your weaknesses.

Get out of Debt:

The best way to save money is to get out of debt as quickly as possible. You will end up paying interest on all your loans instead of earning interest on your savings. You will be surprised how much money can be saved if you get rid of debt or manage it correctly. There are many tools available to help you out. Get on the Sorted website, or, order your debts from highest to lowest interest and pay them off one-by-one.
Research the market to make sure your credit card or loan has the lowest interest rates versus rewards to meet your needs. Take advantage of cards offering zero-percent rates on purchases and balance transfers to help you manage your debts while you pay them off.
The more money you put into your debt, the quicker they will be paid off and you can start taking advantage of being rewarded interest instead of paying. It’s not going to be easy – it might seem easier and more satisfactory to save the money in your bank account but this is the false economy and it will pay off in the long run when you are debt-free! Investing in paying off your debt is the best way to ensure your money has a higher return in the future.

Write a Plan of Action:

Did you know that most people fritter away 15% of their income? That could include extra unnecessary spending or pay extra money to the bank. Whether you’re a spender or a saver, everyone needs a plan. Shoppers find it difficult to save – they often need a reason to save (ie. paying off debt). Write up a plan – learn how to budget!
When you’re working on your budget, it’s always important to include a non-negotiable item – one thing you can treat yourself with, within reason. Whether it be music, shoes or even the outdoors, you don’t want to be tight on yourself otherwise, you will lose motivation. Set small goals for yourself and even set small rewards for yourself when you have achieved those goals. If it’s easier, create a vision board on a whiteboard or piece of paper. When the days are tough, the bills keep coming in and you feel like you are fighting a losing battle, just stick to your guns – in the long run, it will pay off!
If you are great at saving, you could think of a plan to invest. If you have more than six months worth of savings in your emergency fund then you need to start to think about investing.
We understand that many people live week to week. If you feel brave, sit down with a good friend and think of creative ways to earn some extra income. Maybe rent out a room or car space? Can you hire out your specific skills for a couple of hours a week? It’s important to look at your incoming and your outgoing expenses and see if you can cut down on the outgoing expenses, which leads to our next point…

Locate your expenses:

Start tracking your income and expenses. There are great tools and apps available that can help you keep track of your incoming and outgoing expenses. Have a look and identify those one-time expenses – how often are you paying them? Have a look at your recurring expenses – are there better deals out there for you? Look at your phone, internet and power bills – can you find anything cheaper? Look at your subscriptions – can you get reduce these costs, do you really need them all? You need to think about whether it would be cheaper, in the long run, to pay annually, instead of monthly. Cutting down on these types of expenses can really make a difference in the long-term.

Set-up Automatic Payments:

Once you have set your budget and goals, automate all your payments so you don’t forget them and set-up automatic deposits into your savings account. It will help you stay on track with achieving your goal. If your situation changes, review the funds that you transfer and alter where needed.

Tips:

Open a savings account at a different bank – that way it’s harder to transfer money from your savings to your transactional account.
Get insurance – this will help you with private medical treatment or if you lose your job.
Revisit your KiwiSaver fund – choosing the right fund can mean the difference in thousands of dollars for your retirement.
Evaluate your purchases – The op shop or second-hand store is a great place to find some sweet bargains!!
For the brave – studies show that you can save more if you have a friend to hold you accountable. Talk with a trusted friend about your goal and get them to hold you accountable.These are some top tips to help you get on track with your savings. If you have any, we would love to hear from you!