People seem to find finance scary and a taboo to discuss, but why? You earn X, you spend Y therefore X-Y=Savings (what you have left). What is scary is when X-Y=Zero or worse, less than zero.
Does it matter if your friends are well off and you are not? Should you pretend to be as well off as them? Would they still be your friend if you were not well off? Would you still be there friend if you found out they were no longer well off? The main thing is that you are not zero or worse and that you are happy. So what can you do to increase your savings? Simple: X either has to increase or Y has to decrease. I told you finance was simple.
Here are some suggestions and ideas to think on; also if you have some ideas please email us and we will add them. We can all help each other plant the seed and watch it grow, that’s what finance is all about “Knowing and knowledge”.
Let us start by ways of decreasing Y. No one wants to watch ever cent and itemize what they are spending, but why? When you know where your money is going you can then find ways to save.
It can be fun and easy, like taking your lunch to work rather than spending $10 to $12 a day; five days a week that is $50 to $60 pw.
How about take away coffee $3 to $4 per cup, or getting a 7eleven $1 cup, or taking a flask of coffee with you. Now you’re thinking this is petty, but it’s not – I will show you later what you can do with savings.
Every second time you go out to a restaurant, choose a BYO restaurant rather than spending that extra $30 on a bottle of wine.
If you have a close group of friends you go out with regularly, try in autumn and winter, the colder months, to take turns having theme dinners at each other’s places; then enjoy the daylight savings warm months going out.
A lot of the markets have food nights during daylight savings, a fun night with great foods fair prices and something a bit different.
How long since you have had a BBQ or picnic at the park, another great day with savings.
It is amazing how much fun you can have and still save.
Hot days the local swimming pools are great or a day at the beach, take your back pack with your lunch and drinks.
The movies or drive-in always look to obtain discount vouchers, buy the kids or yourselves popcorn, chips, lollies and drinks from the supermarket and take your backpack.
The libraries are great these days, most are online so you can search from the internet what books, DVDs, audio books, etc. are available and reserve them, so they are available when you go and pick them up.
The internet has many magazines and newspapers on-line, so now and then have a look at the internet edition rather than purchasing them.
Now, have a read of “Understanding Principle and Interest Payments”, so you can see what you can do with your savings and how much more you can save. Then go to the “All in one repayment calculator” and work out how much extra you can save. For example, say you have a $100,000 property loan at 6.20% variable interest rate, paying principle and interest payments over 30 years and you are going to put an extra $100 per month on your loan. That is only using $25pw savings. This would save you over $42,000 in interest. Now taking your lunch to work doesn’t sound so bad.