SELF-CARE FOR PARENTS
6 Tips for Saving Money
Making Family Life Easy 9
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This is an excerpt taken from my blog. And I thought post Christmas spending it might be a good idea to include some of the ideas on the parent self care section of the website as well.
Have you ever wondered if you really wanted to save, what strategies could you use?
I've listed below 6 tips that have stopped money slipping through my fingers, from hardest through to super easy. Some of them may work for you if you adapt them to your situation. They certainly worked for me, my family or my friends.
1. Pay Yourself First: How would you go if rather than saving what's left over at the end of every pay, you instead paid yourself first.
We put 9% into superannuation so we couldn't touch it. Then had our entire pay go into a home equity account so any balance helped pay off our housing loan. We also ensured we saved at least 10% of our net income as a safety net. Or for large purchases: car, furnishings, extensions (save and build,) holidays, etc.
2. Five Cups for Fun: Working out a budget and dividing an income up into five sections according to the priority rating system below:
b). Bills and Commitments
c). Necessary Consumables (fuel, food, essential items, etc)
d). Savings for Larger Goal
e). Disposable Income (treats, entertainment, eating out, new clothing, etc)
Ranked in that priority order means savings come ahead of disposable income. Using jars/ envelopes/ separate no fee accounts can be a way of ensuring each section remains independent. A budget is great to inform what is available to put into each category. It might take a few weeks to save up so there's an initial surplus available to cover bills.
This was one of my son's ideas and it works really well because it gives an added incentive to save. But it also makes him feel better about spending money on himself for a treat because he knows other areas of his life are being taken care of.
3. The Snow Ball: Paying off my smallest loans first.
For example: I pay off my credit card at the end of every month. The next priority after that was when we had a high interest car loan. When it was paid off I concentrated on my housing loan.
And if I had my housing loan divided into a larger fixed interest component and a smaller variable component I'd pay the smaller amount off first. Then when that was paid off, I'd use the extra money to pay off the larger one.
4. Having a No Spend Month: Other than absolute necessities such as bills and basic foods after New Year I try not to spend money for a month.
Ideas we've used as a family: Ride to work, pack lunch from home, invite friends over for a games night rather than go out, no alcohol for a month, meet at the beach/park for a catch up, don't go to a shopping centre for a month (don't see, not tempted,) use up what's in the freezer, etc.
If you do this you'll likely be amazed how much money you previously spent on impulse buys like cups of coffee, takeaways, shoes, clothes, makeup, etc. It may even encourage you to start a regular savings plan .
5. Asking for the best price on any electrical, jewellery, (sometimes even clothing) I buy. I learnt not to assume online means cheaper. I've been amazed when I go into a shop I can often get the price reduced to between half to three quarters of the marked retail price on expensive items by asking for the best price.
e.g. I went shopping to buy a ring on behalf of one of our mates for his wife. I shopped around and ended up getting it for just over half the marked price, saving him over $1500.
I've done the same for my son when he was buying a juicer. By asking for the best price I saved him over $180. This Christmas, by going into the jewellery store and asking for the best price, I saved $60 on what was a $159 gift, online.
Because I'm always pleasant to shop assistants they'll usually help me get a good deal if they can. And often they know about an even better option I'm unaware of, like a two for one offer or 40 % off starting tomorrow.
I'll sometimes ask 'Is there any reduction for multiple items?' Which can be useful if you're buying gifts.
6. Not spending a pink one. This was one on my girlfriend's ideas and before she knew it she'd saved $625. The concept is, every time you get a five dollar note you put it aside and save it for a 'Large Goal.'
DISCLAIMER: N.B. The financial information on Best Parenting Advice.com is what I did and what worked for me. It may not however work for you in your financial situation. For financial advice specific to you and your situation you need to seek advice from a financial advisor or accountant.
If you find this information useful, your friends might too
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