Ten Tips for Saving in a Material World

It’s not easy to be thrifty in our consumer society. We’re surrounded by so much temptation that it can be difficult to avoid spending money.

So why not try taking a break from spending? If you can tighten your belt on the little things, it can help ensure you have enough for the odd splurge, that well-earned holiday, or for unforeseen expenses.

Get smarter with your spending...

1. Negotiate on your utility bills
It’s a competitive market, with energy companies chasing your business. So don’t be afraid to ask your provider for a better deal, or switch providers for a better offer. Many companies also offer ‘bill smoothing’ so you make even payments throughout the year and don’t have to worry about a jump in your bill when the season changes.

2. Give up the daily latte
For many of us, the morning coffee has become an integral part of our working routine. But why not try the coffee machine at work? After three months you could have saved more than $360.

3. Buy in bulk... and get to the market
More Australians are realising the benefits of buying home brands and in bulk. Stock up on daily household staples to make some real savings. And for your fruit and veg, it’s worth trying the market. Buying directly from market traders can mean less mark-up. Get there half an hour before stalls close and you’ll find that prices go down rapidly as traders sell off their stock.

4. Shop online
There’s also a reason marketers pay a lot of money to put their products at the end of the aisle. It’s just too easy to pop them into your trolley. So why not go online? You might not get quite so many bargains. You might pay a little for delivery but you’ll avoid those impulse purchases. And by consuming less, you could spend less.

5. Leave the car at home
You could try walking or cycling to work. You’ll save money, get fit and you might even get to work more quickly by avoiding the gridlock. And if your workplace is simply too far away, what about cycling to the nearest train station?

6. Put more into super
You can sacrifice some of your before-tax salary to boost your super and potentially make immediate tax savings. These ‘concessional contributions’ usually carry tax advantages. That’s because these contributions are taxed at only 15% (or 30% if you earn over $300,000pa), which for many people is lower than their marginal income tax rate. You can put up to $30,000 into your super at this concessional tax rate (or $35,000 if you’re 49 or over as at 30th June 2014).

7. Bring your super accounts together
More Australians are realising the power of one super fund. For example, a Financial Adviser can help you bring your super together for immediate savings if you are paying multiple sets of fees.

8. Consolidate your debts
Having a number of debts could potentially mean you pay higher interest rates and multiple sets of fees. So think about bringing them together into the debt with the lowest interest rate, which could be your home loan. The lower interest rate means you’ll pay less interest from day one. And down the line you’ll pay off your debt sooner.

9. Set up an offset account for your home loan
An offset account is a day-to-day savings account typically linked to a variable rate home loan. Your savings reduce the balance of your home loan for the purpose of calculating interest charges. It’s a simple tool that can help you make immediate savings on interest. And over the life of your home loan you could save thousands of dollars.

10. Get your tax return done
The official tax return deadline is the end of October. Although if you’re using an accountant, you’ve got even longer. But why wait until the last minute? The earlier you receive any tax return, the earlier you can start getting your money working for you. After all, it’s your money.

Of course, we’re all different. So it’s important to find your own way to save and make the sacrifices you’re prepared to make to achieve the outcome you want, whether it’s saving for your children’s education or purchasing your dream property.

Article provided by PSK Financial Services. If you would like to meet with a Financial Adviser to help you with a personal savings plan or to review your existing financial situation, please talk to the Ballard team.